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POLITICS: PennAve

Obama nominates three for Federal Reserve board

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Barack Obama,PennAve,Joseph Lawler,Economy,Federal Reserve

President Obama announced three nominations to the Federal Reserve Board of Governors Friday, filling out the panel that will serve alongside incoming Chairwoman Janet Yellen.

Stanley Fischer, the former governor of Israel's central bank and a prominent former Massachusetts Institute of Technology professor, is Obama's pick to replace Yellen as the Fed's vice chairman. Fischer also has worked at the International Monetary Fund, Citigroup and the World Bank. He was the thesis adviser at MIT for current Fed Chairman Ben Bernanke.

Obama also will nominate Lael Brainard, previously the undersecretary for international affairs at the Treasury Department, for an open spot on the seven-member Board of Governors.

And Obama will nominate Jerome Powell for a second term on the board. Before joining the Fed in 2012, Powell was a financial executive and a veteran of the George H.W. Bush Treasury Department.

"These three distinguished individuals have the proven experience, judgment and deep knowledge of the financial system to serve at the Federal Reserve," Obama said in announcing the planned nominations.

That will leave one spot still open on the board, as well as a vice chairman of regulation position created by the 2010 Dodd-Frank financial reform law. Fed governors vote on the Fed's regulatory policies and are permanent voting members of the 12-member Federal Open Market Committee, which sets the bank's monetary policies. The rest of the committee's spots rotate among the 12 regional bank presidents.

The White House had previously indicated that Fischer and Brainard would be tapped for spots on the board, and Powell's renomination was also expected.

It is not clear who Obama will select for the remaining spot on the board, but there are no community bankers among the current or nominated members, following the departure of Elizabeth Duke earlier in 2013.

In the past, Obama has been slow to name picks for the Fed, and has seen some of his candidates get stalled for long periods of time in the Senate.

For example, Peter Diamond, an MIT professor and a winner of the Nobel Prize in economics, withdrew his nomination in 2011 after it was blocked for 14 months by Sen. Richard Shelby, an Alabama Republican on the Senate Banking Committee.

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