One thing that being married has taught me is that meaning is often conveyed not in the words we say to one another but in the manner in which those words are spoken — in other words, it’s not what you say, it’s how you say it.
Yesterday Federal Reserve Chair Jerome Powell
This exchange takes up approximately 15 seconds of a 45-minute conversation between Rubenstein and Powell that was otherwise unremarkable, if only because Powell has already been asked and answered every conceivable variation of the question “When is the Fed going to lower interest rates?” But those brief remarks about his own future at the central bank — and the context in which they were delivered — are worth unpacking.
Let’s remember first that Jerome Powell’s ascent to become the chair of the Federal Reserve has been somewhat unlikely from the start. Powell joined the Fed in 2012 as part of a package deal — Powell, a Republican, was
His odds for renomination at this point in his first term as chair were also rather long. The
Powell’s prospects for a third term as Fed chair, however, are considerably murkier for a couple of reasons. The first is that the candidate currently most likely to be inaugurated as president at the time of this writing is former President Trump, whose antipathy toward Powell seems undiminished with time. If Trump wins, there is ample reason to think that the new administration will demand a greater measure of personal loyalty to the president than Powell has been willing to offer, and for that reason alone Powell would have no chance of being renominated.
If Biden were to prevail in November —
Finally, there is the practical consideration of the expiration of Powell’s term as Fed governor in 2028. Members of the Fed board of governors serve on fixed and staggered 14-year terms, and governors nominated to an unexpired term may be renominated for one — and only one — additional 14-year term. Leadership at the Fed is chosen among sitting governors, so in order to serve as chair you must already be a Fed governor or be nominated separately to an open seat on the board.
Powell’s term expires in 2026, but his term as governor expires in 2028, meaning he would only be guaranteed to serve as chair for two additional years if he were to be renominated. There is a loophole, however, in that a governor can remain in office after their term expires so long as a replacement has not been confirmed. Powell himself did this briefly after
But if the picture I’m painting here is not especially optimistic about the prospect for a third Powell term, it isn’t entirely out of the question. For one, Powell has proven to be
Powell’s Fed may also be experiencing something of a victory lap on inflation around this time next year, when discussions around who should be Fed chair heat up in earnest. Inflation
All of this, of course, is based on the assumption that Powell wants another term if it were offered to him. Certainly one could be forgiven for not wanting to spend another four years living under a microscope and being asked the same questions over and over. But when he was asked yesterday whether he liked the job, Powell was unusually animated in his response.
“I enjoy it quite a bit — I do,” Powell said. “It’s a great honor. It’s incredibly interesting. I love the people we work with. I love the institution. At this time in my life, it’s just been a great thing. I’m in my 13th year there, and it’s been really challenging … but what else would you want?”