Federal Reserve System - Obama Presidency Oral History Back Federal Reserve System Index / Organizations Transcripts Janet Yellen ...Ms. Yellen served as chair of the Federal Reserve Board from 2014 until 2018, vice chai... ...from 2014 until 2018, vice chair of the Federal Reserve Board from 2010 until 2014, an... ...and chief executive officer of the Federal Reserve Bank of San Francisco from 2004 until 2010... ...and I had a term as a governor of the Fed [Federal Reserve Board] from '94 t... ...I had a term as a governor of the Fed [ Federal Reserve Board] from '94 to '97, during th... ...I learned, and that's the core of what the Fed does. Sometimes there can be too muc... ...all the years, certainly, I was at the Fed , came out of the core of economic... ...and chief executive officer of the Federal Reserve Bank of San Francisco. You delivered ... ...Williams now heads the New York Fed [ Federal Reserve Bank ]. Glenn is still in San Francisco... ...would happen to the economy, and could the Fed pick up the pieces? And the answer was... ...would be a recession, but probably the Fed would have the tools to be able to dea... ...and the regulatory system didn't give the Fed authority over investment banks, eve... ...you to serve as vice chair of the Federal Reserve . Had you met President Obama before h... ...and Don was a forty-year veteran of the Fed . He had risen through the ranks. H... ...doing. There are glamorous things at the Fed , and there are less glamorous thing... ...and there are less glamorous things at the Fed . Typically, the chair doesn't ge... ...really need to be done. For example, the Fed supervises the system of twelve Reserv... ...So the rule is as the president of a Federal Reserve Bank , you can serve until age sixty-five i... ...Dodd-Frank that became a focus of the Federal Reserve ? In the aftermath of the crisis... ...aftermath of the crisis, realizing that the Fed had not been on top of what was goin... ...to have bailouts again. They never want the Fed or the taxpayers to be channeling ai... ...under threat. And they took away the Fed 's power to lend, to support an... ...have been a lot worse, I think, if the Fed —we saw what happened with Lehman whe... ...saw what happened with Lehman when the Fed didn't lend. And if you think abou... ...that. The new responsibilities of the Federal Reserve and the kind of planning that you jus... ...you have to bring new expertise into the Fed ? Yes. Is there a lot o... ...which—it was ironic, because the Federal Reserve was really created in 1913 to serve a... ...a banking panic in 1907. There was no Federal Reserve , so large banks were encounterin... ...part of its authority. That's why the Fed was created, to deal with financia... ...with financial stability risks. But the Fed didn't really carefully monito... ...and that has very much changed. But the Fed also wasn't given a lot of powers t... ...That's become an important focus for the Fed . Thanks for that. To that point, whe... ...nominated you to serve as chair of the Fed , in October of 2013, you said, “... ...that Congress has entrusted to the Federal Reserve , to promote maximum employment, stabl... ...your comment about the role of the Federal Reserve in stabilizing the financial system ... ...me, so I guess I was surprised. I mean, the Fed now understands that nothing is mor... ...which is that last March or April, the Fed announced a new facility in which it i... ...time—establishing a facility in which the Fed could make loans, overnight loans, rep... ...and all the work had been done. So, the Fed has done a lot to be prepared for th... ...very hard on this during my time at the Fed . I would say the banking agencie... ...That's not our business.” And I think the Fed stopped enforcing it too. We didn'... ...in addition to the various functions of the Fed , one of the things that you learne... ...time as vice chair and chair is where the Fed didn't have regulatory authority. ... ...“third mandate,” or what you said among the Fed 's responsibilities being to promote ... ...financial system, given the size of the Fed , and the number of personnel there... ...or evolved responsibilities of the Federal Reserve ? Yes. But they weren't hard t... ...through committees that are at the Federal Reserve Board and headed by senior personnel i... ...on financial stability. And within the Federal Reserve System , a lot of economists wanted to do it... ...go wrong, both within the staff at the Federal Reserve , but also academics, and planning, an... ...of the things that was happening at the Federal Reserve during your time there as vice chai... ...that were within the purview of the Federal Reserve in the context of real people? Tha... ...I understood that people were angry at the Fed . They saw the Fed engage in massiv... ...people were angry at the Fed. They saw the Fed engage in massive interventions durin... ...saving.” Now, the truth is that the Fed is an organization that is focused o... ...really assure you, I know the people in the Fed very well, and where their hearts are... ...were so angry, and they were angry at the Fed , and the Fed was caught up in havin... ...and they were angry at the Fed, and the Fed was caught up in having this image of... ...it really important to try to humanize the Fed and make it extremely clear that tha... ...we are focused on Main Street. That's the Fed 's mandate. I wanted to make a... ...formed called Fed Up. They felt that the Fed should be worried about real people wh... ...think we met twice as a full board with the Fed Up people. They brought unemploye... ...to try to promote diversity within the Federal Reserve , and really pushed the Reserve Bank... ...mentioned inequality. Does the Federal Reserve have tools in its capacity to addres... ...employment is an explicit part of the Fed 's dual mandate. After the financia... ...is an important constraint on what the Fed can do for the labor market, because... ...seen more inflation. Now, after I left the Fed , that did occur, and we did not se... ...in low-income areas. And the Federal Reserve also has a role in evaluating banks fo... ...another effort, and that's part of what the Fed is focused on. But the monetary polic... ...for that. I wanted to ask about the Federal Reserve 's asset purchasing program. At you... ...Were the kind of assets that the Federal Reserve was purchasing in 2013 and 2014 th... ...Those are the only things that the Fed has the ability to buy. The Fed i... ...lowered effectively to zero. That's the Fed traditional tool, and there was no mor... ...a ten-year Treasury. Of course, what the Fed says, it has to be credible. It migh... ...and to ordinary people the things that the Fed was doing to try to help the economi... ...the public who it was helping and why the Fed was engaged in it? I guess so. It wa... ...reasonably straightforward. Normally, the Fed acts at the short end. We've lost tha... ...say, there was a lot of pressure inside the Fed to wind down those purchases. Bernank... ...of experience before I had to do it at the Fed . But we prepared very carefully fo... ...hostile to the Obama projects, to what the Fed was doing, to financia... ...restrictions on GAO's ability to audit the Fed . Why are the restrictions aroun... ...confidentiality in the parts of the Federal Reserve that remain confidential, as opposed t... ...important to the work that the Fed does? It's really criticall... ...a mandate through legislation for what the Fed is trying to accomplish, should b... ...called goal independence. The goals of the Fed must be set by Congress. Bu... ...GAO does a huge amount of auditing the Fed . They audit supervision. They audi... ...about here, what this was about, “Audit the Fed ” [Federal Reserve Transparency Act]... ...what this was about, “Audit the Fed” [ Federal Reserve Transparency Act], which was a Ran... ...and push, is intended to politicize the Fed . What that exemption does is it say... ...televised recordings. Transcripts of Federal Reserve meetings, verbatim, are published wit... ...What they wanted to do with this “Audit the Fed ” bill is have the GAO come in afte... ...nasty, difficult thing, because “Audit the Fed ,” that sounds innocent enough. Wh... ...sounds innocent enough. Why shouldn't the Fed be audited? It has four and a hal... ...else is audited. Well, of course, the Fed is audited in all of those ways tha... ...annually by the Kansas City [Missouri] Federal Reserve in the Grand Tetons to demonstrat... ...continuing to improve. It's as though the Fed had its foot pressed to the metal o... ...shortly before your departure from the Federal Reserve , Heather Long, a reporter from th... ...always the focus of what I was doing at the Fed , was trying to create an economy i... ...In a typical post-war recession, the Fed has cut rates by five hundred basi... ...level of short rates is two percent, the Fed doesn't have the ability to do that t... ...deeply concerned about the fact that the Fed is losing its ability to keep th... Show more... Peter Orszag ...he was at the New York Fed [ Federal Reserve Bank of New York]—had trouble navigating th... Neal Wolin ...housing, on a set of topics, what Fed [ Federal Reserve ] authorities needed to exist, a whol... ...the financial regulators—whether it was the Fed or the OCC [Office of the Comptrolle... ...authority should we be prepared to have the Fed do without. Because there was this ide... ...was the scope of the power of the Federal Reserve and the transparency of the Federa... ...Reserve and the transparency of the Federal Reserve . In your opinion, were the new power... ...significantly concentrated in the Federal Reserve ? Or were they distributed mor... ...of a source of liquidity in extremis, the Fed , as the bank of last resort, has thos... ...brought those quite a lot down. But the Fed retained, still, a fair amount o... ...itself, did you think that the power of the Fed would emerge as an important issue o... ...from the get-go, really, that the Fed had been hugely involved in th... ...as well, that for much of the country, the Fed is opaque, and there's not muc... ...There is a complicated bifurcation of the Fed between their monetary polic... ...that conflated those two. So you want the Fed to be opaque on monetary policy, ... ...in Washington but the regional Federal Reserve banks across the country. So all thi... ...yet, in the moment in 2008 and 2009, the Fed was absolutely critical, centrall... ...the long-standing suspicion about what the Fed was and how it did its thing came t... ...tools of the government but also the Federal Reserve , with enough flexibility to deal wit... ...but we wanted to make sure that the Fed had what we thought of as firefightin... ...way that it forced the SEC, the CFTC, the Fed , the OCC, the FDIC at variou... Show more... Jeanne Lambrew ...name, but Tom Daschle's book. He did a Federal Reserve kind of concept too. He was a bi... Tom Harkin ...and now he becomes chairman of the Federal Reserve System . Anyway. Water over the dam... Timothy Geithner ...the senior international person at the Federal Reserve Board, who came with very differen... ...but we worked very closely with the Fed [Federal Reserve], and Alan Greenspa... ...we worked very closely with the Fed [ Federal Reserve ], and Alan Greenspan was chairman fo... ...Were you guided by Section 13[3] of the Federal Reserve Act in particular ways? Yes, I mean... ...to deposit insurance, and access to the Fed 's normal lending facilities, an... ...a mix of deposit insurance, access to the Fed in extremis, some other things the FDI... ...risk. But they wouldn't do it without the Fed taking some risk, and we took the ris... ...the law, under the emergency authority the Fed had given us. That was authority w... ...set of assets around the world that the Fed was legally able to lend against, s... ...legally, which allowed us on our own, the Fed on its own, to prevent their failure... ...problem is that the tools we had, the Fed 's tools really weren't designed t... ...me this right away at the beginning—is, the Fed can lend to a nonbank only in thre... ...could say comfortably you're secure— the Fed is secured to our satisfaction. There'... ...and so what we decided to do was to ask the Fed to make an assessment, institution b... ...exist as independent and outside of the Federal Reserve ? Well, yeah. As I'm sure you'v... ...up with the idea of making it part of the Fed . It's not really part of the Fed... ...of the Fed. It's not really part of the Fed , but— Funded by the Fed. ... ...really part of the Fed, but— Funded by the Fed . Yeah. Were there other parts o... ...the legislation increased the power of the Fed or redistributed it? I would say, i... ...legislation did circumscribe some of the Fed 's authority, but we had started with ... ...a financial crisis, we wanted to make the Fed more accountable for the overal... ...of the financial system, and we thought the Fed was best placed to have that rule. Bu... ...which the Treasury would chair, and the Fed would be a central player on, but on... ...But Congress also took away some of the Fed 's authority for future financia... ...as a set of checks and balances on the Fed , but they also took away some of th... ...less emergency authority available to the Fed and the FDIC than will be necessary i... ...him, and to us, to the Treasury and to the Fed , at various moments, for ideas o... ...and chief executive officer of the Federal Reserve Bank of New York from 2003 to 2009. In thi... ...mitigate that. We did a lot of things, the Fed did a lot of things to bring overal... ...effort that went underway across the Fed , the CFTC, the SEC, the OCC [Office o... ...on deficit reduction, Chairman of the Federal Reserve Ben Bernanke described the combinatio... ...I worked with, and in my colleagues at the Fed , and certainly stunningly grateful fo... Show more... Larry Summers ...the commercial system. The Treasury and the Fed [Federal Reserve System] felt thes... ...system. The Treasury and the Fed [ Federal Reserve System ] felt these values very strong. ... ...the need to engage in very large-scale Federal Reserve lending at the beginning of the COVI... Cass Sunstein ...The independent agencies like the Federal Reserve Board, the Federal Trade Commission... Load more Transcripts Related Topics go to the Supreme Court Supreme Court go to the Atlantic Relations Atlantic Relations go to the Women and Girls Women and Girls go to the Veterans Veterans go to the Democrats Democrats