Who is Jay Powell?

On February 5th, Jerome ‘Jay’ Powell was sworn in as the 16th Chairman of the Federal Reserve, following Janet Yellen, who served one term starting in 2014.

Powell’s first day on the job was the sharpest day of the recent stock market selloff, when the S&P 500 lost more than four percent.

I don’t think that the market fell because of the new Fed Chair, but I have read a lot of folks who say that the market likes to ‘test’ new Chairs.

Unlike most Fed Chairs in recent years, Powell is not an economist.  Although that bothers the professional economist class, it’s helpful to remember that Paul Volker, one of the most venerated Chairmen of all time, was not an economist either.

Powell had enjoyed an illustrious career on Wall Street and Washington. After attending Princeton, he received a law degree from Georgetown. From there, he worked Dillon Reed, a notable investment bank.

His first stint in government was in 1990 when he served as an under-secretary of the Treasury under George H. W. Bush, overseeing policy on financial institutions.

After that, he became a partner at the mega-private equity firm, The Carlyle Group for eight years, ending in 2005.  Even though Powell is a Republican, he was nominated to join the Fed’s board by Barack Obama.

One of the interesting things about Powell is that we don’t know much about how he will steer the Fed.  The consensus seems to be that he will continue on the path set forth by Yellen, but it’s hard to say at this point.

On Friday, Powell will make his first appearance on Capitol Hill when he delivers the Fed’s semi-annual monetary policy report to Congress.  As you might imagine, the market is waiting to hear what he has to say with bated breath.