With President Obama winning re-election, it's unlikely that we'll see any changes at the Federal Reserve and the FOMC. Fed Chairman Bernanke is expected to serve out his term, but when his term ends in January 2014, it has been reported that he will probably turn down a third term even if President Obama wants him to stay. If Chairman Bernanke does leave, his replacement will likely be Janet Yellen who is currently Vice Chair of the Board of Governors at the Federal Reserve. According to this Bloomberg article:
And where is Yellen today? Possibly in line to succeed Bernanke, whose second four-year stint as chairman ends in January 2014. “In a second Obama term, were Bernanke to leave, Janet Yellen would be at the top of the short list for Fed chair,” says Mark Calabria, director of financial regulation studies at the Cato Institute.
Don't expect Yellen to be any better than Chairman Bernanke for savers. According to the Bloomberg article:
Count Yellen as a dove. She says the Fed can help create jobs with accommodative monetary policy and should tolerate somewhat more inflation to achieve that end.
In this Reuters graphic of the Fed, Yellen is shown to be more of an inflation dove than Chairman Bernanke.
The best hope for savers is that the economy does improve enough for the Fed to start tightening its monetary policy which will eventually lead to higher interest rates. I'm afraid I don't see any other path for higher rates in the next 5 years. In fact, it could be much longer. One economist says history "suggests interest rates may continue falling until 2022". It's possible that other factors could force higher rates especially for the longer-term maturities. However, I think the chance of that happening is low. Long-term CD rates may be very low, but those rates are still higher than savings account rates. That doesn't mean all money should be put into long-term CDs, but keeping a CD ladder going is still reasonable in my opinion. CD ladders have a long history of providing a sound strategy for the low-risk part of one's portfolio.