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Economics

Economics Major Learns Principles Directly from Uncle Sam

Image of Jack Johannessen

Jack Johannessen, a Central Washington University senior, spent a prestigious internship this summer learning the ins and outs of the Federal Reserve System. The agency is the central banking system of the United States and run by a presidentially appointed board.

The Fed’s Avenues Internship Program offers rare work-experience opportunities at its Washington DC headquarters to outstanding undergraduate and graduate students majoring in economics—like Johannessen—and other academic disciplines.

“The people there are brilliant—they do so much research and they have a lot of resources available to use,” he states. “I liked the environment. It would be an interesting place to work for an extended period of time.”

Fed monetary affairs economist John Kandrac, who served as Johannessen’s mentor, explains how the internship works, “The economists have a certain project in mind that they would like an intern for. Every intern usually works on just a single project with one or two economists. Typically, the goal of the project is to develop it into an academic research paper.”

Johannessen internship responsibilities were specifically focused in the Fed’s Division of Monetary Affairs, which provides banking, finance, and money market analysis.

“It was a fairly advanced project and certainly challenging,” says Johannessen.

It centered on the rates of refinancing under the federal Home Affordable Refinancing Program (HARP) to see if the lower interest payments it provided helped homeowners pay off their debts or default less frequently on other loans.

Johannessen says he appreciated one particular insight from Kandrac. “If I want to be a serious economist, I need to be able to identify a problem, ask the right questions, and then comb through the data and see what’s going on with the numbers and statistics as a way to get to the essence of what’s going on. He emphasized that to me and now I know what to do.”

Kandrac adds, “He certainly got exposure to the process and what it’s like to work on an academic research paper.”

Johannessen, from Vashon Island, says the highlights of his experience were his interactions with peers, including some from Ivy League schools, who received the paid internships.

“All of them were very smart, interesting, and driven individuals,” he adds. “I was able to make lots of great connections with the other interns, some Federal Reserve staff, and members of other federal agencies too. The group that I spent most of my time with—about 10 to 15 people—all wanted to do different things within the [economics] field. I will undoubtedly have lasting friendships with some of them.”

Johannessen is now in the midst of fall quarter classes at CWU, finishing work on his degree. He will graduate in 2016.

“I’m certainly more confident in my abilities and I have a deeper understanding of how the field of economics works now—it’s much more data driven than what I thought,” Johannessen acknowledges. “I am going to utilize every lesson—and all that I learned—to its maximum potential. I know this experience will open a lot of doors for me in terms of what I can do and where I will work after I graduate.”

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