Janet Yellen is an American economist and educator. She has been working as the 78th United States secretary of the treasury since 2021. In 2021, she became the first woman to work in that department. She has been praised for her economic contributions to her country. According to Investopedia, former president Barack Obama once considered her one of America’s foremost economists and policymakers.
Janet studied economics at Brown University, Rhode Island. Initially, she enrolled in a Philosophy course at the university. She switched to economics after being inspired by her professors, Herschel Grossman and George Herbert Borts. She graduated from the university in 1967 with a bachelor’s and immediately enrolled in a Ph.D. program. After getting her Ph.D., she was involved in several careers. The careers have largely made her achieve her net worth. Without further ado, here are details on how she became affluent.
After receiving her Ph.D., she became an assistant professor of economics at Harvard University in 1971. At the time, she was one of only two women in the university’s economics department. The other woman was Rachel McCulloch, and they soon became friends. They would go on to write several academic papers together. Her position as an assistant professor ended in 1977 when she became a staff economist for the Federal Reserve’s Board of Governors.
Edwin M. Truman recruited Janet as a staff economist because he knew her when she was a Ph.D. student. At the time, he was a junior professor who heard one of her oral exams. He recruited her so that she could research international monetary reform. While in school, she met her future husband, George Akerlof. By the time they got married, George had accepted a teaching position at the London School of Economics (LSE).
She left her post to accompany her husband to the United Kingdom. They remained in the country for two years and returned to the United States. In 1980, she joined the faculty at Berkeley’s Haas School of Business to conduct macroeconomics research. According to Women’s History, she researched and published policies about fair pay, reducing unemployment and valuing people’s work. Additionally, she lectured undergraduate and MBA students and did it for at least two decades.
Federal Reserve (1994-1997)
In 1994, President Bill Clinton became interested in nominating her as a Federal Reserve Board of Governors member. He regarded her as one of the most prominent economists of her generation. In 1994, she had a hearing with the Senate Banking Committee. During the hearing, she claimed that federal policies should keep an economy growing without increasing inflation.
The committee was impressed and hired her. In 1996, the Federal Reserve chairman Alan Greenspan was reluctant to raise interest rates after unemployment declined. Instead, he wanted to opt for a zero inflation policy. Janet sought to dissuade him from making that move. Instead, she told him that the central bank should moderate inflation and not eliminate it. In 1997, she left her position to become chair of the Council of Economic Advisers.
Council of Economic Advisers (1997–1999)
When she assumed her new role, she replaced Joseph Stiglitz. The Senate confirmed her unanimously for the position. She became the second woman to hold the job after Laura Tyson. While in office, she also chaired the Economic Policy Committee of the Organization for Economic Cooperation and Development. While in the council, she oversaw a landmark report titled “Explaining Trends in the Gender Wage Gap.” The report focused on the gender pay divide in 1998. It claimed there was a 25% difference between average pay for men and women. In 1999, she tendered her resignation, citing personal reasons. She returned to teaching at UC Berkeley.
Return to the Federal Reserve (2004-2018)
In 2004, she was appointed president of the Federal Reserve Bank of San Francisco. She became the first woman to secure this position. During her tenure, she spoke out about the Fed’s monetary policy committee. She expressed concerns about the possible consequences of the boom in house prices. The other concern she had was the banks’ heavy concentration on risky construction and home development plans.
In 2010, President Barack Obama nominated her to succeed Donald Kohn as vice chair. Compared to her predecessors, she acted more as an independent force within the institution. She tried to persuade the committee to adopt her favored monetary policies. One policy involved pumping more money into the economy to reduce unemployment. She stopped working in this role after President Donald Trump appointed Jerome Powell in her place. Nevertheless, she still found work to sustain her.
She made a lot of speeches from 2018-2021. During this period, she made plenty of money. According to Forbes, she made $5 million from speaking in 2019. The following year, she earned around $2.2 million. Big firms would ask her to make speeches, which explains the enormous pay she would get. Some firms that enlisted her services included Credit Suisse, Citadel, Standard Chartered Bank, and City National Bank. Thanks to her gigantic payments, she was able to acquire some assets.
In 2019, she bought a $2.1 million home in Washington, DC, with her husband. This is not the only house that they own. In 1979, they bought a house in Berkeley. Today, the house is valued at about $2.2 million. Besides owning houses, she has invested millions of dollars in an index fund that tracks the S&P 500. Also, she has millions in bond funds and cash accounts. Lastly, she has invested in stocks in companies like Pfizer, DuPont, Phillips 66, Raytheon, and Norfolk Southern.
Janet made a decision that would forever change her life. She was about to pursue a Philosophy course before changing her mind to do economics. That is not to say that you cannot become wealthy with a Philosophy course. Economics addresses financial issues that governments and the public are interested in. That explains why she landed so many government jobs. When she was not in government, she would teach and deliver speeches. That proves she was wise enough to diversify her duties. As an economist, she has demonstrated how best to invest money. If you follow her steps, you could become just like her.
Written by Allen Lee
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