Gannett Yelan (photo courtesy of Wikipedia free license)
Janet Yellen, the US Treasury Secretary, is once again on thin ice within the Biden administration because of her intervention in the banking crisis that continues to rear its head, the NY Post reported. Now the question is not if Biden will fire Yellen, but when. The requirement is to bring in someone who can deal with the biggest banking crisis the US has known since the financial crisis of 2008.
Many officials in the White House express disbelief in Yellen’s ability to deal with the crisis, despite her resume, and the factor that started the crisis in relations with Yellen was her vague response to inflation. Among the names that came up were Commerce Secretary Gina Raimondo and Bank of America CEO Brian Moynihan.
More in-
Unlike Yellen, both of these candidates have real business experience, while Yellen has been in academia and government throughout her career. The sources think that Yellen cannot handle the collapse of the banks and needs someone with more experience “in the field”.
“On the one hand, they’re pretty stuck with her. It would be bad to get rid of a finance minister during a banking crisis,” one of the sources told the Post. “On the other hand, they know they don’t have someone good to be their face in terms of response.”
Yelan clearly heard the criticism. On Friday, she convened an emergency meeting of the top bank regulators to discuss the widening crisis. The agenda will likely include not only past bank collapses, but the impasse over the fate of the First Republic – bankers are trying, so far in vain, to save the institution from being the last domino to fall in the mess.
In addition, there is the fear of the collapse of the German bank Deutsche Bank, which, given its size, entails a significant systemic risk for the entire financial system, including large banks such as JP Morgan and Bank of America that trade with the German bank.
Comments to the article(0):
Your response has been received and will be published subject to the system policy.
Thanks.
for a new comment
Your response was not sent due to a communication problem, please try again.
Return to comment