White House Denies Cohn Report, Says Considering “At Least Six” For Fed Chair

Denying yesterday’s WSJ report that Trump has “fired” Gary Cohn from his future role as Fed chair due to his strong opposition to Trump’s handling of the Charlotteville tragedy, Bloomberg reports that the White House is considering “at least a half-dozen candidates to be the next head of the Federal Reserve, including economists, executives with banking experience and other business people”

The breadth of the search goes against the narrative that has taken hold in Washington and on Wall Street that the Fed chair nomination is a two-horse race between National Economic Council Director Gary Cohn and current Fed Chair Janet Yellen, whose term expires in February.

Actually, according to many, including online betting markets, the race has – for a while – been between mostly Yellen and Kevin Warsh, who as of today are both neck and neck in their online odds of being nominated Fed chair on February 4.

Previously, President Donald Trump said that both Yellen and Cohn, were being considered for the top Fed job. Since then, Cohn’s prospects have grown cloudy after he publicly criticized remarks the president made in the wake of racially-charged violence in Charlottesville, Virginia. The Wall Street Journal reported Wednesday that Trump is unlikely to pick Cohn for the post, and three people close to Trump told Bloomberg that Cohn’s prospects for the Fed job have dimmed.

But three people familiar with the process say Trump is not yet deeply focused on the search. It is still being conducted by staff who aren’t ready yet to present him with a short-list of vetted candidates. John DeStefano, the president’s chief personnel recruiter, is in charge of the search, one person said.

Trump’s former chief strategist Steve Bannon, who clashed with the more moderate Cohn inside the White House before his departure last month, told 60 Minutes in an interview to be broadcast Sunday that Cohn should “absolutely” resign.

“It’s been glacial in filling some of these jobs, which is surprising because the president during the transition” talked a lot about “retaking control” of the central bank, said Jaret Seiberg, a Washington policy analyst for Cowen & Co. in an interview with Bloomberg Television.

Acording to Bloomberg, some of the other possible contenders include former Fed Governor Kevin Warsh – a vocal opponent to the Fed’s destructive groupthink – as well as Columbia University economist Glenn Hubbard and Stanford University professor John Taylor, one of the people familiar said. Bloomberg adds that Lawrence Lindsey, a former economic adviser to President George W. Bush, has been discussed. Former US Bancorp CEO Richard Davis and John Allison, the former CEO of BB&T Corp., have also been considered.

Meanwhile, here is the list of most likely candidates according to PredictIt, which after yesterday’s drop in Cohn odds, has Yellen and Warsh neck and neck at roughly 26% odds each.

This post originally appeared on Zero Hedge


Leave a Reply