Janet Yellen’s Awkward Day

There is good reason to hope that Janet Yellen may go on to become one of the great leaders of the Federal Reserve: she’s a first-rate economist, a gifted explicator of complicated concepts, and an experienced hand at navigating Washington. (At her first appearance as Fed chief on Capitol Hill, last month, the Republican senators may not have been eating out of her hands, but they treated her with unusual deference.) In policy terms, she’s on the side of the angels: passionately committed to getting the economy growing and bringing down unemployment, particularly for the long-term jobless, who have been the biggest victims of the Great Recession and its aftermath.

On Wednesday, though, at her first press conference as chairwoman of the Fed, Yellen had an awkward time, conveying a message that she may well not have intended to, and spooking the markets. This may not be a big deal: Alan Greenspan and Ben Bernanke made similar errors in their early days and quickly recovered. But it did indicate some of the challenges Yellen faces in extricating the Fed from the emergency policy actions it has taken during the past five years.

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