Yesterday, President Obama announced that Janet Yellen was his choice to replace Ben Bernanke as chair of the Federal Reserve, once his term ends in January 2014. The question most investors are wondering about is how her policies would differ from Bernanke's, especially since much of the investment community is anxious about the effect that tapering the Fed's asset purchases will have on the stock market.
But Bernanke's term extends past the end of the year, and most observers think the taper will come at some point around the end of 2013. Yellen has been a deputy under Bernanke for years, and is considered one of the architects of the quantitative easing program. A Wall Street Journal poll of economists found that 60 percent of them think Yellen's policies on QE will be no different from Bernanke's.
One potential area of difference: inflation. Yellen has signaled that she think it's worth running inflation of 2.5 percent in order to drive down unemployment, while Bernanke's inflation target has always been 2 percent. That could be something to watch in the years to come.
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