Ever since news broke yesterday that
Larry Summers had withdrawnhis name as a candidate for Federal Reserve chair, all the chatter has centered around the other
contenders to replace Ben Bernanke.
Dennis Gartman, editor and publisher of The Gartman Letter thinks Janet Yellen continues to be the best choice.
He argues in favour of her even though he thinks some see her as “damaged goods”:
“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 favourite.”
Gartman for his part makes no bones about the fact that he didn’t support Summers. “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,” Gartman writes. He called his decision to step down a gentleman’s decision.
Gartman thinks other candidates include Tim Geithner, former Fed vice chairman, Roger Ferguson, and former Bank of Israel governor Dr. Stanley Fischer.