Biden names Sarah Bloom Raskin as Fed’s top banking regulator

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President Biden will name Sarah Bloom Ruskin as the Federal Reserve’s top Wall Street cop, a Biden administration official said, one of three candidates to be unveiled for crucial open seats on the central bank’s board of governors.

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Why this matters: It is Biden’s biggest ever mark on the influential economic body that is at the center of the nation as the country grapples with the fastest-growing inflation in decades and a recovering labor market.

  • Biden also tapped Lisa Cook, an economist who taught at Michigan State University and previously served on the Council of Economic Advisors during the Obama administration, and Davidson College Philip Jefferson, a former Fed economist.
  • If confirmed, Cook would be the first black woman to serve on the Fed’s seven-member board, while Jefferson would be the fourth black person.

Between the lines: Biden’s choice for the Fed’s oversight vice president, Ruskin, is likely to appease Democrats who want someone in the role who is tough on financial regulation and outspoken on issues like climate change.

  • Ruskin, a Duke University law professor who served as Fed governor from 2010 to 2014 before joining the Treasury Department during the Obama administration, has been outspoken about regulators’ climate change financial system. poses a risk to.
  • If confirmed, Ruskin could influence how banks and other financial institutions weigh and disclose their climate risks. Republican senators indicated this week that they would be skeptical of his climate views and may outright oppose his nomination.

Bottom-line: Biden’s choice for the Fed board comes at a critical time for the central bank moving to reduce inflation much more than was initially thought.

  • With the new additions there could be a greater focus on issues the Fed has recently begun to be more vocal about, say Fed watchers — including climate change and a more inclusive definition of full employment. which factors into indicators such as the black unemployment rate.

What will happen next: Fed Chair Jerome Powell, tapped for a second term by Biden in November, and Lyle Brainard, Biden’s vice president, both face confirmation hearings this week and are on track for Senate votes.

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