Reuters - Video

EDITION: U.S. | U.K. | IN

Decoder

Yellen's challenges "unprecedented": Economist Mark Thoma

Monday, December 09, 2013 - 02:40

Janet Yellen could be confirmed as Fed chair as early as Thursday, and she will face the task of navigating the central bank through uncharted waters, contending with the largest-ever balance sheet and untested regulatory powers, says University of Oregon economist Mark Thoma.

▲ Hide Transcript

View Transcript

I believe the challenges that. -- Elmo phase. When she is confirmed our unprecedented. I can't think of another fed chair that faced challenges that are as important and as big as she's facing right now. I think there for a challenge is that Janet Yellen will face when she is confirmed. The first in the biggest -- the exit strategy getting the timing right getting the magnitudes right all of those sorts of things he'll be judged in the future quite a bit by how well she manages. The exit from QE if they get this thing wrong. And start pulling back too early in interest rates by congress to try and recovered that's gonna slow the employment recovery is gonna slow the recovery overall -- more unemployment. So the first big one here is the exit strategy I would agree that this program can not continue forever the second thing I think that she will face when she's confirmed as regulations. Although Dodd-Frank passed quite awhile ago only about 40% of its been implemented they're still quite a ways to go lot of rule making to go we've still got the problem of equipment of bank runs in the shadow banking market. Exactly what the problem was during the the financial panic and that problem has been solved yet. So -- that's going to be a big challenge getting that done right the third challenge she may face is whether or not the Fed needs to actively pop bubbles. She made a statement in 2005. That you agree with Alan Greenspan that we shouldn't -- the -- shouldn't pop bubbles that -- only try to clean up afterwards that turned out to be a bad strategy for the housing bubble in 2009 she changed her mind -- -- I think the Fed should actively go in and pop bubbles when they see them. If it looks like there's a bubble inflating for some reason maybe they don't manage exit strategy right or something along those lines. Then she's gonna face a big challenge about how will provide the leadership to either pop that bubble or let it go in the decision she makes could be critical. Finally if the financial sector gets in trouble I think there's a big issue with too big to fail banks in the resolution authority. And whether the Fed and other people who have input on this we'll have the courage to actually put banks through the resolution. Authority let them fail. And then see how markets react. -- is more -- Overwhelming response here 659%. Saying they think Jack McKeon is more dovish fed up Fed Chairman remember back with 15% say much more dovish. Janet Yellen has been. Pegged as a dove and she's studies she doesn't care about inflation all the sorts of things I think she might surprise markets in how tough she'll be. If inflation doesn't fat rear its head. I don't think she's going to put employment over inflation at all she's made indications in the past that she cares about inflation she understands it's important. And if inflation rears his head I think markets might be quite surprised at how strongly she reacts.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Yellen's challenges "unprecedented": Economist Mark Thoma

Monday, December 09, 2013 - 02:40

Top News »

Most Popular »

Investing 201 »

Arian Foster = BlackBerry? Arian Foster = BlackBerry?

Fri, Oct 25, 2013 - (3:16)

Don’t miss these red flags for IPOs Don’t miss these red flags for IPOs

Thu, Oct 10, 2013 - (2:34)

Copycat currency trading Copycat currency trading

Wed, Oct 02, 2013 - (2:28)

When to dump a winner When to dump a winner

Tue, Sep 24, 2013 - (1:55)

Where gold might again attract Jim Rogers Where gold might again attract Jim Rogers

Thu, Sep 19, 2013 - (2:05)

Why savings interest rates won't budge Why savings interest rates won't budge

Fri, Sep 13, 2013 - (2:09)

Buy local? ETFs try the trend Buy local? ETFs try the trend

Thu, Sep 05, 2013 - (2:42)

The better bond funds The better bond funds

Wed, Aug 07, 2013 - (2:40)

Best bargain in 40 years? European stocks Best bargain in 40 years? European stocks

Thu, Aug 01, 2013 - (2:24)

Invest like an activist Invest like an activist

Fri, Jul 26, 2013 - (2:49)

Why bruised Brazil is a buy Why bruised Brazil is a buy

Fri, Jul 19, 2013 - (2:48)

3 ways to fix your bond portfolio 3 ways to fix your bond portfolio

Thu, Jul 11, 2013 - (3:10)

The next gold? Diamonds lure investors The next gold? Diamonds lure investors

Wed, Jul 03, 2013 - (2:38)

How to play the Fed’s tapering timeline How to play the Fed’s tapering timeline

Thu, Jun 20, 2013 - (2:34)

How to play banker on the web How to play banker on the web

Tue, Jun 11, 2013 - (2:57)

3 surprises about the 2013 stock rally 3 surprises about the 2013 stock rally

Fri, May 24, 2013 - (2:11)

How to cash in on lawsuits - Investing 201 How to cash in on lawsuits - Investing 201

Tue, Apr 30, 2013 - (2:30)

Rising dollar will drive stocks higher Rising dollar will drive stocks higher

Wed, Apr 10, 2013 - (2:32)

A little-known path to big dividends - Investing 201 A little-known path to big dividends -...

Thu, Apr 04, 2013 - (3:16)

What exactly does Warren Buffett own? - Investing 201 What exactly does Warren Buffett own? -...

Thu, Feb 14, 2013 - (0:51)

Big short bets: Where are they now? - Investing 201 Big short bets: Where are they now? -...

Fri, Dec 21, 2012 - (2:33)

How iPhone 5 sales affect your wealth - Investing 201 How iPhone 5 sales affect your wealth -...

Wed, Sep 26, 2012 - (2:52)

How to avoid doomed ETFs - Investing 201 How to avoid doomed ETFs - Investing 201

Mon, Sep 24, 2012 - (1:56)

Money Clip »

3 things to do before disaster strikes 3 things to do before disaster strikes

Wed, Sep 18, 2013 - (1:39)

Your must-do money list Your must-do money list

Wed, Sep 11, 2013 - (1:24)

The worst "best" financial advice The worst "best" financial advice

Wed, Sep 04, 2013 - (1:42)

Forget gold: The case for REITs Forget gold: The case for REITs

Fri, Apr 26, 2013 - (1:19)

3 rules for buying a house now 3 rules for buying a house now

Thu, Apr 18, 2013 - (1:39)

“Stalking” your dream home - Money Clip “Stalking” your dream home - Money Clip

Wed, Mar 27, 2013 - (2:50)

3 hidden tax deductions - Money Clip 3 hidden tax deductions - Money Clip

Thu, Mar 21, 2013 - (1:33)

How to break your prenup - Money Clip How to break your prenup - Money Clip

Thu, Mar 07, 2013 - (1:18)

Watch your wallet on Pinterest - Money Clip Watch your wallet on Pinterest - Money Clip

Thu, Feb 21, 2013 - (1:33)

Get set for the big bull run - Money Clip Get set for the big bull run - Money Clip

Thu, Jan 24, 2013 - (3:41)

Raising charitable kids - Money Clip Raising charitable kids - Money Clip

Tue, Dec 11, 2012 - (1:24)

Render unto Apple - Money Clip Render unto Apple - Money Clip

Fri, Dec 07, 2012 - (2:50)

Reuters Investigates »

Re-homing victim: "I could have been dead" Re-homing victim: "I could have been dead"

Wed, Feb 19, 2014 - (8:24)

Cops and loggers in the Amazon rainforest Cops and loggers in the Amazon rainforest

Fri, Jan 10, 2014 - (4:01)

"Passed around like a dog" "Passed around like a dog"

Thu, Aug 29, 2013 - (6:32)

Adopted, then abandoned online Adopted, then abandoned online

Thu, Aug 29, 2013 - (13:21)

How the DEA keeps its secrets secret How the DEA keeps its secrets secret

Mon, Aug 05, 2013 - (1:36)

How education lost its role as the great equalizer - Reuters Investigates How education lost its role as the great...

Mon, Dec 17, 2012 - (7:52)

Jihad Jane: From abused child to American jihadist - Reuters Investigates Jihad Jane: From abused child to American...

Sat, Dec 08, 2012 - (10:01)

Jihad Jane: The order to kill - Reuters Investigates Jihad Jane: The order to kill - Reuters...

Sun, Dec 09, 2012 - (10:39)

Lessons of the Jihad Jane case - Reuters Investigates Lessons of the Jihad Jane case - Reuters...

Sun, Dec 09, 2012 - (3:43)

Exclusive: Jihad Jane in her own words Exclusive: Jihad Jane in her own words

Sat, Dec 08, 2012 - (4:11)

Attorney: How a Maryland teenager became radicalized - Reuters Investigates Attorney: How a Maryland teenager became...

Fri, Dec 07, 2012 - (4:21)

Counselor: Jihad Jane at 17 - Reuters Investigates Counselor: Jihad Jane at 17 - Reuters...

Thu, Dec 06, 2012 - (4:17)

Reuters Investigates: Easing the grip of China's state-owned giants Reuters Investigates: Easing the grip of...

Tue, Oct 16, 2012 - (3:16)

Critics warn shadowy groups could bring bloodshed if Chavez loses - Reuters Investigates Critics warn shadowy groups could bring...

Mon, Aug 13, 2012 - (2:54)

Starbucks brews up big tax breaks Starbucks brews up big tax breaks

Mon, Oct 15, 2012 - (3:46)

Moving Pictures »

Still missing – MH370 Still missing – MH370

Fri, Sep 05, 2014 - (2:05)

Images of August Images of August

Fri, Aug 29, 2014 - (1:00)

Burning Together Burning Together

Mon, Sep 01, 2014 - (2:23)

Mending dolls, teddies and hearts Mending dolls, teddies and hearts

Fri, Aug 22, 2014 - (3:12)

"Old timers" sail the Chesapeake Bay "Old timers" sail the Chesapeake Bay

Mon, Aug 11, 2014 - (2:27)

Burned memories Burned memories

Fri, Aug 08, 2014 - (3:02)

Images of July Images of July

Thu, Jul 31, 2014 - (1:20)

World Cup: passion on the pitch World Cup: passion on the pitch

Fri, Jul 11, 2014 - (1:00)

A refugee in America gives back A refugee in America gives back

Wed, Jul 02, 2014 - (3:25)

A long search for refuge A long search for refuge

Fri, Jun 20, 2014 - (3:04)

World Cup: Around the globe in 50 goals World Cup: Around the globe in 50 goals

Fri, Jun 06, 2014 - (1:08)

VIVID – Sydney’s spectacle of light VIVID – Sydney’s spectacle of light

Fri, May 30, 2014 - (1:37)

The week that changed Boston The week that changed Boston

Mon, Apr 14, 2014 - (3:28)

360° snapshot of life in Kabul 360° snapshot of life in Kabul

Fri, Apr 04, 2014 - (1:26)

A blind teenager, living with vision A blind teenager, living with vision

Thu, Mar 27, 2014 - (3:51)

TIMELAPSE: Backstage at the Oscars TIMELAPSE: Backstage at the Oscars

Wed, Mar 05, 2014 - (2:49)

TIMELAPSE: Lunch with Oscar nominees TIMELAPSE: Lunch with Oscar nominees

Wed, Feb 12, 2014 - (2:55)

Sochi Highlights: Let the games begin Sochi Highlights: Let the games begin

Fri, Feb 07, 2014 - (0:40)

TIMELAPSE: On the Golden Globes red carpet TIMELAPSE: On the Golden Globes red carpet

Tue, Jan 14, 2014 - (3:28)

Pictures of the Year 2013 Pictures of the Year 2013

Fri, Dec 20, 2013 - (3:03)

Marching to the beat of Sousa's drum Marching to the beat of Sousa's drum

Thu, Dec 05, 2013 - (6:11)

The Gettysburg Address The Gettysburg Address

Thu, Nov 28, 2013 - (2:31)

Making Gruyere: A family affair Making Gruyere: A family affair

Wed, Oct 16, 2013 - (5:06)

Abortion: After the decision Abortion: After the decision

Tue, Sep 17, 2013 - (5:46)

A Hollywood Timelapse A Hollywood Timelapse

Mon, Jul 22, 2013 - (2:24)

Idaho's militia training Idaho's militia training

Wed, Jul 17, 2013 - (5:04)

Tornado survivors of Moore, Oklahoma Tornado survivors of Moore, Oklahoma

Fri, Jun 07, 2013 - (5:25)

24 hours in Taksim Square 24 hours in Taksim Square

Thu, Jun 06, 2013 - (1:00)

A Zeppelin flashback A Zeppelin flashback

Wed, Jun 05, 2013 - (6:50)

Dateline Asia »

Breakingviews: Alibaba priced for believers Breakingviews: Alibaba priced for believers

Thu, Sep 18, 2014 - (3:09)

Sterling jumps, on Scottish vote Sterling jumps, on Scottish vote

Thu, Sep 18, 2014 - (2:56)

Rare rock on the block in Hong Kong Rare rock on the block in Hong Kong

Thu, Sep 18, 2014 - (1:43)

Alibaba IPO is 'overhyped': Mark Mobius Alibaba IPO is 'overhyped': Mark Mobius

Thu, Sep 18, 2014 - (4:13)

China tech players chip away at Alibaba China tech players chip away at Alibaba

Wed, Sep 17, 2014 - (4:02)

Breakingviews: India hits Japan/China radar Breakingviews: India hits Japan/China radar

Tue, Sep 16, 2014 - (2:20)

Asia corporate sentiment is slipping Asia corporate sentiment is slipping

Tue, Sep 16, 2014 - (1:36)

Alibaba's China roadshow Alibaba's China roadshow

Mon, Sep 15, 2014 - (2:16)

Asia Week Ahead: Xi Jinping gets down to business in India Asia Week Ahead: Xi Jinping gets down to...

Fri, Sep 12, 2014 - (1:56)

Vancouver 'unaffordable'? Not in China Vancouver 'unaffordable'? Not in China

Thu, Sep 11, 2014 - (3:16)

Breakingviews: Export shortfall damaging emerging economies Breakingviews: Export shortfall damaging...

Wed, Sep 10, 2014 - (2:33)

Hong Kong democracy - the facts Hong Kong democracy - the facts

Wed, Sep 10, 2014 - (1:26)

Breakingviews: Get to know the Alibaba valuation calculator Breakingviews: Get to know the Alibaba...

Tue, Sep 09, 2014 - (3:30)

Abe looks to Japan's consumers Abe looks to Japan's consumers

Tue, Sep 09, 2014 - (1:45)

Corruption crackdown gives rise to a new mooncake in China Corruption crackdown gives rise to a new...

Mon, Sep 08, 2014 - (2:09)

Asia Week Ahead: China trade to reveal recovery pace Asia Week Ahead: China trade to reveal...

Fri, Sep 05, 2014 - (1:22)

Breakingviews: Beijing signals no more 'hands-off Hong Kong' Breakingviews: Beijing signals no more...

Sun, Aug 31, 2014 - (3:08)

Flying kangaroo Qantas looks to loyalty program for cash Flying kangaroo Qantas looks to loyalty...

Sun, Aug 31, 2014 - (2:36)