Sen. Elizabeth Warren (D-Mass.) is “not sure” about President Obama’s pick to fill the No. 2 spot at the Federal Reserve.
The outspoken liberal and bank critic expressed concerns about the nomination of Stanley Fischer to be the Fed vice chairman on Bloomberg’s “Political Capital with Al Hunt.”
“I want to be hopeful ... I am not sure,” she said.
Fischer has served as an academic, and spent time at the International Monetary Fund and as head of the Bank of Israel. However, he has also spent some time on Wall Street, working as a vice chairman at Citigroup.
Warren’s reticence came after she joined with other liberal Democrats to push Yellen to replace the outgoing Ben Bernanke. That pressure ultimately nudged out former Treasury Secretary Lawrence Summers, who withdrew his name from consideration despite reports he was the president’s preferred pick.
Warren did not detail her reservations about Fischer, but only said that now is a “hard time” for the Fed.
“This economy has not recovered the way it should,” she said. “What we’re seeing is the Federal Reserve has very limited tools.”
Warren also gave a “mixed grade” to Bernanke as he heads for the exit. While she credited his work for stabilizing the economy after the financial crisis, she argued too much attention was paid to the biggest institutions. She also said he dropped the ball on financial regulation before the meltdown occurred.
However, she is “more hopeful” about the Fed’s watchdog role under Yellen, saying she is saying all the right things about the job and could cast a tougher perspective on big banks.
“Yellen is making commitments in the direction of saying she understands the problem,” she said. “Janet Yellen’s data-driven, look at the numbers. The big banks are getting bigger and they’re taking on more and more risk.”