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Summers Versus Yellen

Posted by WorldWideMarkets . on Jul 30, 2013 3:01:00 AM
With so much riding on the next Federal Reserve chairman, potentially current vice chair Janet Yellen or former Treasury Secretary Larry Summers, there is going to be more comment as we go forward. Any announcement may come in September but could come as late as October. Yellen is probably still the front runner and will largely continue Bernanke’s path with her own stamp as is fitting an economist of her stature. But Summers has his supporters and a closer look is warranted. Summers comes from an era of deregulation under Clinton and is likely to be publicly opposed to the back lash of regulation that sprung up during the Great Financial Crisis. Already a stark difference to Bernanke. And while any Fed Chairman will have to grapple with the end of QE, Summers is likely to be more aggressive than Yellen. If Summers takes the helm, the dollar may do better in the near term but investors are also going to want to see a continuation of the economic recovery under its own steam with no hint of any setbacks or stallfed logo resized 600. Any such hints could hinder the dollar. We, like everyone else, are watching the Federal succession closely. Perhaps no change at the top job has been so important in years.

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