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The Federal Reserve’s policy of encouraging low interest rates – both short-term and long-term – may last a while longer now that Larry Summers has announced his withdrawal as a potential contender for Ben Bernanke’s job. That’s the clear view of financial markets. Summers was considered more hawkish on the economy, which means that most people thought he would be more likely to rein in the government’s massive stimulus program. Stock futures rallied after Summers’ pulled his name from the list. Today’s front-runner to be the next chairman is 67-year-old Janet Yellin, a key architect of current policy. Yellin is now vice president of the Fed and is believed to be a strong supporter of keeping interest rates low as long as possible.
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