These were pledges that successive US administrations had spent years advocating. “I am sitting there and thinking, ‘My God, think about the history of this’,” Yellen recalls. Common acceptance of this language “represents a triumph for the US in the postwar period”, she says. “And here is the United States completely deep-sixing that as a governing principle for global economic relations without having anything obvious to replace it with.”
At home, the post-crisis regulatory framework is unfinished, she argues, yet Washington is currently embarked on a drive to ease burdens on financial firms rather than plug gaps. Among the key vulnerabilities are lending to indebted, less creditworthy corporate borrowers, which Yellen sees as a source of potential systemic risk. “There are a lot of holes,” she says. “We should not feel the financial stability glass is full.”
The restaurant is beginning to quieten down as we order espressos and discuss Yellen’s background. Born in 1946 and raised in Bay Ridge, a middle-class part of Brooklyn, she came from a close family. Her mother was a teacher who stayed at home to look after Yellen and her brother. Her father was a doctor who had studied medicine at St Andrews University in Scotland, in part because it was so difficult at the time for Jewish medical students to find openings in the US.
Yellen grew up to be an academic star. Saturdays were spent not on the sports field but browsing the mineralogy hall of the Museum of Natural History, or in extracurricular mathematics classes. While some school students swapped baseball cards, Yellen and her friends traded rocks.
This is awfully early to be criticising us. Think about what is going to happen later on as the economy slows. It is a frightening prospect
I ask if Yellen still has her mineral collection and it transpires that she does — the trove sits securely in boxes in Berkeley, California, where she and her husband own a house. She gives me a bemused look after I ask if she had a favourite, and reveals that she did: a chunk of Tasmanian crocoite she bought as a girl from a store in Manhattan.
It was “the apple of my eye in terms of minerals”, she says, chuckling to herself, before finding a picture of the rhubarb-coloured crystals on her iPhone.
Perhaps sensing that I’m seeking to typecast her, Yellen points out that she spent plenty of time hanging out with her friends and that she was not a “nerd”. And while her gifts in mathematics were formidable, she decided at Brown University to pursue a discipline rooted in real-world problems, entering the field of economics.
She later met her future husband Akerlof in the staff canteen of the Fed, where they had research posts, and the two ended up collaborating on work closely. They have a son, Robert, who teaches economics at the University of Warwick. The three are close and holiday together. “He still seems to like his parents for some odd reason,” she says, smiling.
She credits her husband and son for encouraging her to stand her ground and not be pushed around when dealing with the internal battles she faced at the Fed. “They pushed me to be more aggressive than maybe I would have been.”
I am rounding things off with a plate of tiramisu, and at my invitation Yellen helps herself to a bite. Trump’s failure to re-nominate her to the Fed marked a defeat for the cause of women in a male-dominated profession, but she says she did not hear anything to suggest that sexism was a part of it.
The same cannot be said for the broader world of economics. Twenty years ago, Yellen recalls, she would probably have argued that being a woman had done nothing to slow her career progress. Today her take is darker. A lot of work in academic economics is done jointly, she says, and it was very difficult for women to break into the male-dominated social and professional circles in which ideas were shared and projects hatched.
A recent furore over sexist posts on an online economics jobs messaging board shows what women are still up against. There are men in the field who are “extremely aggressive and hostile towards women”, Yellen adds. This can entail demolitions of women’s work in seminars that can be confidence-shaking. Nice guys watch disapprovingly, she says, but that doesn’t mean they speak up.
The Fed itself has faced mounting pressure to boost participation of minorities and women, and Yellen makes it clear this is also very much a work in progress. “There is not much of a pipeline of women in the field,” she comments.
By this time the restaurant is emptying and the pop music has been silenced. Two and a half hours after we started lunch, I suspect that the staff would not be too disappointed if we headed for the door. Yellen offers to contribute to the bill, but I decline in accordance with Lunch with the FT rules.
We part ways on a chilly street corner and Yellen makes her way back to Brookings on foot. It is an obvious contrast to the black government cars that were whisking her around town until just a few months ago. Trump may have deprived Yellen of the trappings of high office, but she clearly has no intention of retreating into silence.