A few thoughts on Janet Yellen as Treasury secretary. Obviously she brings some firsts to the role — the first woman and aside from the brief role of Larry Summers, the first economist as opposed to business type or politician 1/

Obviously a huge change in personal style from her predecessor 2/

Also, perhaps less noticed, a really interesting intellectual background. Her work with George Akerlof helped lay the foundations for behavioral macroeconomics — macro based on observation of how people actually act, not how maximization says they should act 3/

I suspect that this background played a role in her relative accuracy as a forecaster. In particular, she was especially inclined to wait for actual evidence of inflation, as opposed to assuming that it must be coming 4/

In the current context, this means that she's not likely to say "Eek! Debt!" as opposed to looking for evidence that debt and spending are actually problems 5/

She is, of course, part of a team — and it's a huge contrast with the outgoing team. Basically, to have been part of Team Trump you had to have gotten the last financial crisis wrong; Team Biden, reassuringly, is composed of people who got it right 6/