BREAKING: Larry Summers is front-runner for Fed Reserve chairman, source tells Hayes it's certain

[AllINeedIsCoffee]

1) President Obama really likes Summers. And he’s surrounded by Summers’s longtime colleagues and friends. Conversely, Obama doesn’t really know Yellen, and nor do any of the White House’s economic principals.

2) The Obama administration’s top concern is choosing someone who cares about the Federal Reserve’s mandate to maintain full employment as well as its mandate to keep inflation low. Yellen and Summers are both seen as clearing that bar. So the choice is defaulting to other considerations.

3) This White House, more so than any other in modern memory, knows in its bones that the economy can fall apart at any second. China could suffer a hard landing, Europe could fall apart again. Some London Whale-like trader could blow a hole in JP Morgan Chase. If that happens — particularly given Washington’s dysfunction — the Fed is really the first responder. This White House is very comfortable with how Summers handles a crisis.

http://www.washingtonpost.com/blogs/wonkblog/wp/2013/07/23/right-now-larry-summers-is-the-front-runner-for-fed-chair/

Christopher Hayes @chrislhayes

A source close to this says it's "way past that." WH has all but decided on Summers. Unreal.

[geek tragedy]

1. Ben must stay! Ben must stay! nt

[AllINeedIsCoffee]

4. Fun fact about Summers:

In an October 2001 meeting, Summers criticized African American Studies department head Cornel West for allegedly missing three weeks of classes to work on the Bill Bradley presidential campaign, and complained that West was contributing to grade inflation. Summers also claimed that West's "rap" album was an "embarrassment" to the university. West pushed back strongly against the accusations.[36] "The hip-hop scared him. It's a stereotypical reaction," he said later. West, who later called Summers both "uninformed" and "an unprincipled power player" in describing this encounter in his book Democracy Matters (2004), subsequently returned to Princeton University, where he had taught prior to Harvard University.

http://en.wikipedia.org/wiki/Lawrence_Summers#Cornel_West_affair

[geek tragedy]

5. Jesus, I feel like rooting against both of them in that fight. nt

[elehhhhna]

12. Summers is BFEE nasty alla way

says much about bho

new boss/old boss

[roamer65]

21. Didn't he make some rather ignorant comments on women?

I think I remember something like that happening.

[sabrina 1]

24. Yes, he doesn't think women are as intelligent as men, or something like that. Unbelievable

that this is what we get by 'electing Democrats'. But no longer surprising.

He was also one of the gang, together with Greenspan, who drove Brooksley Borne out of her job AFTER she warned about the dangers of derivatives to the economy. I will never forgive any of them for that. Speaking of women being the 'less intelligent' than men.

SHE got it right, all those years ago, and if morons like Summers had not been there to stop her from doing her job, the global collapse might never have happened.

[markpkessinger]

22. And don't forget that charming speech he gave as President of Harvard . . .

. . . in which he said that women are innately/genetically inferior to men in areas of math and science (http://www.guardian.co.uk/science/2005/jan/18/educationsgendergap.genderissues). Sexist, elitist tool!

[zappaman]

2. Let's hope he doesn't leave his homework in the car again...

[Junkdrawer]

3. That will be the gift that keeps on giving....

for the 1%

[on point]

6. What a disaster. Obvious DLC politico fix is in

[LittleBlue]

7. Mind boggling

One of the worst choices imaginable. Might as well have Greenspan back.

[bigwillq]

8. Yuck

Hope this isn't true.

[Gus Lammas]

9. and the wheels on the bus go round and round, round and round, round and round

[sabrina 1]

25. Don't worry, the talking points are already prepared. You won't have to wait long.

Let me play a game just for fun:

1) Look, the President HAS to pick someone who has a chance of being approved.

Us: Look, maybe he should try fighting for someone who is actually worthy of the job.

2) Summers worked for Clinton. Would you rather have someone who worked for Bush!!

Us: ??? We already have several who worked for Bush. Clapper eg?

3) You just hate Obama no matter what he does.

Otoh, maybe this would be the straw that breaks the camel's back?

[avaistheone1]

13. Summers is just about the worst person who could be selected.

[markpkessinger]

14. Oh, HELL no! n/t

[LWolf]

15. Good God.

[tritsofme]

16. Summers would be a solid pick.

It's been clear for a long time that he was the frontrunner.

[leftstreet]

23. You're missing an 'r' n/t

[Union Scribe]

27. Lol

[matthews]

30. It's like you were fed the perfect straight line. Kudos for hopping on it. nt

[tritsofme]

39. lol

[WCGreen]

17. I knew when he came in that he was a status quo kind of guy...

A lot of great talk, hinting that he was a progressive, telling a lot of people that it was time for a big change...

But then there was the way he kind of dream walked into office and almost immediately let the GOP Congress define his presidency.

Why didn't he have a plane of action set up? Why did he surround himself with Democrats in name only?

Oh well, that has all been hashed out before.

I guess there is just too much money at stake for anyone really leftist to get elected...

[kenny blankenship]

18. It's like we're living under some kind of curse...

Larry Summers? Please tell me this is some kind of a sick joke or a prank on your part.

[roamer65]

19. I'd rather have Geithner than Summers.

Last edited Wed Jul 24, 2013, 12:14 AM - Edit history (2)

Timothy at least has experience from the 2008 panic as NYFRB president. But I don't think he really wants the job.

Either way it would be only the second time in history that someone served as Treasury secretary and Fed chairman, if one of these two get it. Only other person to serve as fed chair and treasury secretary was G. William Miller under the Carter admin.

[zipplewrath]

20. The same idiot

So he's going to appoint the same idiot that miscalculated the needed size of the stimulus by at least half (and ignored all critics to the contrary) to be in charge because he's demonstrated such skill at managing the economy. Next thing ya know he'll appoint a guy that's never improved, much less ran, a public school in his life, as secretary of education..... Oh, wait.....

[matthews]

31. He lost Harvard how many billions? nt

[morningfog]

26. Horrible choice.

[AZ Progressive]

28. WTF

The remaining hope and respect I had for Obama will be lost if he nominates Summers.

THIS FUCKER PROMOTED AND OVERSAW LEGISLATION THAT ULTIMATELY LED TO THE 2008 FINANCIAL CRISIS / RECESSION!!!

[matthews]

32. Well wait until he okays the Keystone. That's going to be something. nt

[dkf]

29. What a disaster: Larry Summers's Billion-Dollar Bad Bet at Harvard

President Obama has only a few months to pick a candidate to replace Ben Bernanke as chairman of the Federal Reserve, and while the betting website Paddy Power has Fed Vice Chair Janet Yellen leading the pack at 1:4 odds, Larry Summers remains a strong contender at 11:2.

Despite an impressive resume that includes stints as Treasury Secretary and chief economist of the World Bank, there is a very good reason Summers shouldn't be in charge of monetary policy: He seems to have trouble with interest rates.

During the financial crisis, Harvard lost nearly $1 billion because of some unusual and ill-judged interest rate swaps that Summers implemented in the early 2000s during his troubled tenure as the university's president.

Interest rate swaps allow borrowers to lock in a fixed interest rate on floating-rate debt, which can be good to hedge against short-term uncertainty. The problem with Harvard was that Summers wanted to lock in interest rates for money that the university hadn't actually borrowed and wasn't planning on borrowing for a very long time.

More on a doozy of a bad idea...

http://mobile.bloomberg.com/news/2013-07-18/larry-summers-s-billion-dollar-bad-bet-at-harvard.html

[BlueStreak]

33. Tell me again how this would be different from RMoney

[OilemFirchen]

34. Just curious...

As there are no obvious candidates without the stench of corporatocracy (and, of course, all attendant and associated foibles), what fucking difference does it make?

More to the point, would it make more sense for Obama to pick a known ally, someone with the potential to steer Fed policy toward his vision of growth and stability, or an individual with a cleaner resume but no loyalty to the administration?

Oh, and by the by, I have no dog in this fight. Call me whatever you wish - I don't care. Just asking.

[AllINeedIsCoffee]

36. If the WH floated the name just to screw with people, then nominate Janet Yellen instead...

It will be priceless to watch.

[OilemFirchen]

38. It's tired, and I'm getting late.

Help me, then. Whose heads would explode with the biggest bang?

[AllINeedIsCoffee]

40. The people hard-pressed to find anything negative to say about her.

No one in her line of work is without some criticism, but she's no Larry Summers.

[OilemFirchen]

41. I think the fact that she's on the Fed...

instantly disqualifies her among the emoprogs, right?

I've always been discouraged by Obama's fixation on inflation, and clearly think that Yellen's approach is more sensible. But there still is the fealty-factor. I give Obama props for the recovery thus far, so think, to some degree, that it's fair he gets to call the shots.

Color me conflicted, but not outraged one way or the other. Bet that'll make me some new friends here.

[octoberlib]

35. On top of being a sexist, which is bad enough .........

Despite his alleged brilliance, he seems to exhibit what can charitably be described as the worst judgment of any economist ever in existence. Granted, discussing economists with poor judgement is an embarrassment of riches, but Summers manages to surpass that crowd in ways never previously imagined.
He is essentially a smarter version of Alan Greenspan — only lacking Greenspan’s keen judgment, insight and humility (in case it escaped your notice, this is sarcasm ).
Consider Summers “brilliant” track record:

• He has consistently argued for privatization and deregulation of the financial sector;

• He oversaw the repeal of Glass-Steagall via the passage of the Gramm-Leach-Bliley Act;

• He approved the (previously illegal) merger between Citibank and Travelers;

• He oversaw (and indeed encouraged) concentration in the financial sector, thinking bulked up banks are a virtue. This led to the rise of the TBTF institutions (formerly known as mega-banks);

• He successfully fought Brooksley Born, then chair of the Commodity Futures Trading Commission, to rein in financial derivatives;

• He oversaw passage of the Commodity Futures Modernization Act of 2000, preventing ALL Federal regulation of derivatives. The CFMA also exempted derivatives from state insurance oversight and antigambling laws;

• Thanks to Summers, derivatives still have no minimum reserve requirements, no disclosure obligations, no transparency and no exchange listing/reporting requirements

http://www.dailykos.com/#

[roamer65]

37. I'm dead sure the banking cartel wants Summers.

He's their toadie.