are reportsthat the White House will nominate former Israeli central bank chief Stanley Fischer to serve as deputy Fed Chair, taking over the job Janet Yellen will vacate when she becomes chair.
People are freaking out because Fischer is an unexpected and unprecedented choice, and an absolute legend in central banking circles.
This longer profile of Fischer from the Washington Post’s Dylan Matthews is worth reading, but here are a few of the reasons his rumoured nomination has people so excited.
- He’s credited with essentially saving the Israeli economy, the economy barely faltered during the global financial crisis.
- While other countries were still struggling in the depths of recession or depression, Fischer actually raised rates in Israel in 2009, basically saying that the crisis was over for the country. It’s the ultimate central banking power move.
- He aggressively manipulated the country’s currency, the Shekel, and the massive devaluation helped the country keep growing.
- Israeli politics might be even more dysfunctional than the U.S. congress, but Fischer still got the job done, and is hugely respected in the country.
- Fischer was Ben Bernanke’s thesis advisor at MIT, probably the world’s best economics department, and advised other famous economists like ECB Chief Mario Draghi and Harvard’s Greg Mankiw.
- He is a brilliant academic economist, and one of the fathers of New Keynesian economics, which is the dominant approach in leading departments.
- He has some fascinating and unconventional views on monetary policy, and is a de facto champion of NGDP targeting.
- The rest of his résumé is equally stellar, he helped resolve the Asian financial crisis of the late ’90s at the IMF, and rose to a top job at Citigroup
Fischer is a rock star.