Speculation
that Larry Summers is the favored candidate to take over Ben
Bernanke as Fed chief has resurfaced in recent weeks,
prompting a strong backlash from some industry watchers,
with one going as far as labeling his potential appointment
as a "black swan" event.
"There is a lot to be said that the next Fed
chair is going to be picking up a surgery in the middle
of surgery, think of it that way - that's very difficult
to do," CEO of Bull and Bear Partners Jack
Bouroudjian told CNBC, referring to the difference between
Summers and Bernanke policies.
Summers is seen as a greater hawk between the two,
which analysts say could mean the rapid unwinding of the
massive U.S. monetary stimulus that has supported the
economy.
"That could be the black swan that people
aren't expecting," Bouroudjian said.
The choice of the successor to Bernanke, who is
expected to step down in January when his term expires,
has come down to a two-horse race between Summers, former
Treasury Secretary under Clinton's administration, and Fed
vice chair Janet Yellen, who up until a few weeks ago
appeared to be the firm favorite.
But earlier this week, CNBC reported that a source
from the
Barack Obama administration has said
the chance of Summers' appointment was 2 out of 3 ,
reviving the debate once again. Although Summers is
broadly considered "brilliant" and capable, he is also
known for his volatile and aggressive personality, leading
many to doubt he is the right person for the job. Yellen,
on the other hand, is considered to be a calmer and more
diplomatic contender, and many see her gender working in
her favor, considering that Obama has been under pressure
to nominate more women.
Analysts say the timing of a transition isn't
ideal right now. Global markets have been whiplashed in
recent months on the prospect of the Fed paring down its
$85 billion a month bond buying program, with escalating
tensions in Syria adding to the volatility this week.
"The problem is the Fed is in a transition phase," said
Boris Schlossberg, managing director at BK Asset
Management. "[At a time] when you need the strongest
amount of leadership, you have none...It could create big,
big problems for the Obama administration."
"I think that is going to
be Obama's worst policy error ever if he appoints
Summers right now," he added. "The last thing you
need in a turbulent market, lots of uncertainty is
to put in such a controversial figure on top."
Not everyone was opposed to
the idea of Summers as the next Fed chairman,
however.
"The fact of the matter is that Larry Summers is
probably one of the smartest people ever to embrace Wall
Street or economics. He's a brilliant man... it's
definitely going to be a different Fed if Summers is
appointed," said Bill Smith, CEO and president of SAM
Advisors.
"Larry Summers the exact 180 [degrees]
opposite of Ben Bernanke. He's brash, he's crass, he's
aggressive, cantankerous... it's going to be great,
there will be a headline for reporters every day,"
added Smith.
Hmmmmmmm......and what would that headline
be? the LAST # Fed Chairmen were pretty QUIET
People. You know.....NOT MAKE WAVES type of Fed
Chairmen....
COOL.....................CALM.........................COLLECTED.
IF SUMMERS IS THE NEXT FED CHIEF it could be a
DISASTER!!!!!!!!!!!!!!!!!!!
REMEMBER: the NEW Federal
Reserve Chairman CURSE?????
EVERY NEW Fed Chairman has been TESTED in a BIG WAY, soon
after taking the position.
HMMMMMMMMMMMMMMMMMMMMM....What BETTER Test, than to
have the RAPTURE happen, soon after the next Fed Chairman
takes office????
TICK TOCK..................the DOMINOES.....are ALL
LINED UP!!!
YFIC<
Randy