Once-revered central bank heads failed to foresee the housing bubble and the great financial crisis that followed. As a result, faith in the Fed has plunged.
People had high confidence in Alan Greenspan for much of his tenure, but that confidence tailed off towards the end. Confidence in Ben Bernanke declined further, and confidence in Yellen is at or near record lows.
The following chart shows the shift in confidence under the last three Fed chairs.
Shift in Confidence
The above chart from the Wall Street Journal article Years of Fed Missteps Fueled Disillusion With the Economy and Washington.
Bernanke had more negative marks than Yellen, but more positive marks as well.
In the early 2000s, confidence in Chairman Alan Greenspan often exceeded 70%. An April Gallup poll found 38% of Americans had a great deal or fair amount of confidence in Ms. Yellen, while 35% had little or none.
Note that St. Louis Fed president Bullard is worried about confidence in the Fed: Bullard Warns Yellen on Credibility, Sticks with Forecast “1 Hike in Next 2.5 Years”
Mike “Mish” Shedlock