For UBS marketing purposes Janet Yellen gets sworn in as Treasury Secretary. (ddp) US Politics and Policies Video: Janet Yellen aims to go big and go green 17 February 2021, 10:11 pm CET, written by UBS Editorial Team Janet Yellen is a woman of many firsts. She was the first female head of the Federal Reserve, she is the first woman to lead the US Treasury Department and she may very well be the first Treasury Secretary to make the green agenda a major part of the department’s remit. She also recently said it’s time to “go big” in terms of fiscal support for the economy. What does all this mean? John Savercool, Head of the UBS US Office of Public Policy, joined UBS Trending hosts Anthony Pastore and Wendy Mock to discuss. Watch the video here. Some highlights: Question: Before we dive into her new job, what do we know about Janet Yellen from her time as the Fed Chair? What can we glean about how she might approach her new role as Treasury Secretary? Answer: Janet Yellen is a familiar figure in Washington and those involved deeply in the economy. She has a strong mix of Federal experience and academia, which is a trait typical of many Biden appointees. Most in Washington are comfortable with her, even if some disagree with her. She’s a Dove - she places a lot of emphasis on unemployment and is prepared to “go big”, meaning that she believes in an active Federal Government to fight the pandemic and other significant economic problems. Question: Yellen is said to be looking to appoint someone to monitor the risks that climate change poses to the financial system. Several news outlets have reported that she may be tapping Sarah Bloom Raskin, who is former deputy Treasury Secretary under Barack Obama for this role. What does this mean for the remit of the Treasury department and climate change regulations? For UBS marketing purposes Answer: Sarah Bloom Raskin, like Janet Yellen and many of the Biden appointees, has a strong mix of Federal experience and academia. Sarah Bloom Raskin is also the wife of Congressman Jamie Raskin, who led the impeachment efforts in the House, so the Raskin name is prominent in Democratic circles. Yellen’s steps to appoint someone to look at climate change is consistent with the priorities across many of the departments under President Biden. All have or will be given a role in fighting climate change. President Biden is aiming for net zero carbon emissions by 2050 and a 100% clean power sector by 2035. 2035 is only 14 years away and 2050 is also not that far away. Trying to transform our entire economy from a fossil fuel-based energy based to a renewable fuel sector will be a Herculean task. Some think this is needed through the timetable the President has established, while others are skeptical. But this is a prominent theme across all Federal departments. On the ground we will see this in the form of tightening regulations on fossil fuel producers and the ending of large pipeline projects that require Federal approval. The rejection of the Keystone Pipeline is an example of that. We will likely see a similar rejection of the Dakota Access Pipeline. The President does need legislative changes to provide tax breaks for the renewable fuel energy sector, make new investments in green energy and to pass his tax and infrastructure bill, which we will see this summer. Question: Over the weekend it was reported that Yellen stressed the need for the G7 to, in her words “go big” with fiscal stimulus, to support economic recovery from pandemic. What do you interpret this to mean? Answer: Secretary Yellen is fully behind President Biden’s proposal to enact a new stimulus bill of $1.9 trillion, on top of the $3.7 trillion already approved by Congress and signed into law by former President Trump. This is new money, all added to the deficit. Going big would require something in the neighborhood of $1.9trillion rather than what Republicans propose, which is a little over $600 billion. This is consistent with the Secretary’s call to have the Federal government play an active role in “going big” to better manage the pandemic and get the economy on a better track. We will see activity on ground next week when the House passes their version of the $1.9 trillion stimulus bill. I don’t anticipate the House having any trouble signing the bill and the Senate will take on the bill in March. The pathway to a positive vote in the Senate will be more difficult because Democrats only have 50 votes there. All 50 will be needed to pass a bill. Therefore we might be see some hold ups or changes to the bill, but I do think it has a better chance of passing than not. We will likely see a final bill in mid-March. For more, watch the full video conversation with John Savercool. The latest Washington Weekly (published on 12 February, 2021) is on the topic of budget reconciliation and what it means for the next stimulus bill. Check out this video with Chief Investment Office strategist Amantia Muhedini discussing climate change and sustainable investment opportunities. Main contributor: Wendy Mock Important information As a firm providing wealth management services to clients, UBS Financial Services, Inc is registered with the U.S. Securities and Exchange Commission (SEC) as an investment adviser and a broker- dealer, offering both investment advisory and brokerage services. Advisory services and brokerage services are separate and distinct, differ in material ways and are governed by different laws and separate contracts. It is important that you carefully read the agreements and disclosures UBS provides to you about the products or services offered. For more information, please visit our website at www.ubs.com/workingwithus. © UBS 2021. All rights reserved. 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