1. She has pushed the Fed to use aggressive new policies to boost the economy.
2. She has a record of being concerned about excessive inflation.
3. She is a good forecaster.
4. The financial crisis made her a believer in tougher financial regulations
5. She believes in transparency, and the markets thinks she’s a good communicator.
More details at the Wall Street Journal (ungated article): Five Things You Need to Know About Janet Yellen
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There is no doubt the immediate market perception is that Yellen is a big dove – the USD was sold off (though not much) on the news hitting the wires. But Yellen is far more nuanced than that – just lumping her in the ‘dove’ basket is too simplistic.
She is one of Fed’s better analysts of the economy, takes very seriously its dual mandate on both unemployment and inflation, and is a consistent advocate for better communication and greater transparency.
