Because of a quirk in the law, Fed Chair Janet Yellen and Vice Chairman Stanley Fischer can thwart President-elect Donald Trump’s ability to reshape the central bank.
There’s no indication they want to do this, and Fed tradition would dictate that they won’t. More so, it’s likely that Trump will have the opportunity to dramatically reshape the makeup of the Fed, although it’s unclear toward what end.
But it’s a curious part of the Federal Reserve Act, that, in at least some respects, it’s up to Fischer and Yellen, and the choice may not be as easy as a decision to follow tradition or not.
Yellen’s four-year term as chair ends in February 2018. But Yellen simultaneously (like all chairs and vice chairs) is also a governor of the Federal Reserve Board. Her 14-year term as governor doesn’t expire until 2024. Fischer’s term as vice chairman expires in June 2018, but his term as a governor continues until 2020.
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