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Bush to fill Fed vacancy
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June 8, 2001: 3:25 p.m. ET
First Tennessee National executive Susan Bies to replace Edward Kelley
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NEW YORK (CNNfn) - President Bush plans to nominate Tennessee banker Susan Bies to a vacancy on the Federal Reserve Board, the White House said Friday.
Bies, an executive vice president of First Tennessee National Corp. in Memphis, would be the only woman on the seven-member board, if her nomination is confirmed by the Senate.
There currently are two vacancies on the central bank's governing board, which forms the nucleus of the powerful Federal Open Market Committee, the policy making body that sets U.S. interest rate policy. The FOMC has cut short-term rates by 2.5 percentage points this year in an effort to revive the sluggish U.S. economy.
Fed Gov. Edward Kelley said Monday he intended to leave the Fed board once Bush found someone to fill one of the two vacancies, saying he would stay on until then to ensure "a minimum of five active board members."
Kelley's decision to step down offers Bush the chance to fill four seats on the Fed board early in his term. Earlier this year the Republican president decided to reappoint the Fed's vice chairman, Roger Ferguson, an economist originally picked by fellow Democrat and former president Bill Clinton.
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Bies, 54, has a doctorate in economics and taught the subject for years at the college level. Some analysts said she was a good choice because she combined economics expertise with practical banking experience, a quality that White House officials were seeking as they vetted candidates for the Fed board.
"She is so smart, it's scary," said James Chessen, chief economist at the American Bankers Association lobby group. "She's very much a theoretician, but it's always directed toward what's practical and possible."
Bies originally was hired by First Tennessee in 1979 as a staff economist, and she rose to become treasurer, then chief financial officer and, most recently, the bank's auditor and executive vice president in charge of risk management. 
From staff and wire reports
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