Thursday, September 19, 2013

GARTMAN: Yellen Is The Front-Runner For Fed Chair

Concerning the possible replacement candidates, as noted above Dr. Yellen, the current Vice Chairman, has to be the front runner, although certainly she may be seen by some as “Damaged goods” given that she was already relegated to second-tier stature by the fact that the President had apparently chosen to pass her by as his nominee.

Nonetheless, Dr. Yellen clearly has the expertise and is well enough liked within the structure of the Fed to fill this role very well indeed. Despite the “Damaged goods” problem, she has to be considered the front runner if for no other reason than she had to go through a Senate confirmation hearing when she was posted to the Fed as its Vice Chairman in October of ’10.

Helping Dr. Yellen’s cause is the simple fact that she did a much, much better job of forecasting the problems that were to beset the US’... and the global... economy in ’07- 09 than did many other ranking officials on the Fed. Simply put, she got it right where most others missed the collapse entirely. And finally, of course, she is a woman and although the country is past this sort of consideration it is a real consideration nonetheless. Were we betting folks here at TGL, we'd have to consider Dr. Yellen as the prohibitive favorite.

Simply put, Mr. Summers is a rather unlikeable fellow, but who almost certainly is the 'smartest guy in the room' in whichever room he enters, but he has proven, shall we say, 'difficult' at very best.