Richard Clarida, managing director of Pacific Investment Management Co. (PIMCO), listens during a Bloomberg Television interview in New York, U.S. (Photographer: Christopher Goodney/Bloomberg)

Fed Nominee Clarida Favors Balanced Approach to Policy

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(Bloomberg) -- Richard Clarida, President Donald Trump’s nominee for vice chairman of the Federal Reserve, told U.S. lawmakers he would support policies that take a “balanced approach” to achieving the Fed’s goals of maximum employment and price stability.

“I fully support both pillars of this dual mandate and pledge to the committee that if I am confirmed by the Senate, I will support monetary policies that take a balanced approach to achieving these important objectives,” Clarida, a prominent monetary economist and global strategic adviser at Pacific Investment Management Co., said in testimony he is scheduled to deliver Tuesday before the Senate Banking Committee. The hearing gets underway at 10 a.m.

Clarida also pledged to support banking reforms instituted following the financial crisis of 2008-09.

“My priority will be to support policies that are effective, efficient, and appropriately tailored, and that preserve the far greater resiliency and stability of the financial system that has been achieved as a result of the significant reforms that have been put in place since the financial crisis,” he said.

Joint Testimony

Clarida is set to appear alongside Michelle Bowman, a separate pick to serve as a Fed governor. Bowman, Kansas state bank commissioner, has been nominated to fill a seat at the Fed Board in Washington reserved for a person with community bank experience. Both jobs require confirmation by the full Senate.

Clarida, 60, whose nomination marked another mainstream pick by Trump after he tapped Jerome Powell to be Fed chairman, would bring a set of respected academic and market credentials to the U.S. central bank.

He played a leading role among a wave of economists who since the 1980s have developed mathematical models describing the fundamental forces at play in an economy and used them to inform monetary policy making.

He also spent more than a decade at Pimco, one of the world’s largest money managers, and served a stint at the U.S. Treasury Department in the George W. Bush administration. He earned his Ph.D. in economics from Harvard University.

Less is known about Bowman, particularly her views on monetary policy. A biography on her agency’s website describes her as a fifth generation banker who worked at Farmers & Drovers Bank in Council Grove, Kansas. She also served in government for several years in Washington, first on the staff of former Kansas Senator Bob Dole and later as deputy assistant secretary and policy adviser to Homeland Security Secretary Tom Ridge.

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