According to hedge funds, former Treasury Secretary Timothy Geithner should be appointed as the next Federal Reserve chairman. During the Skybridge Alternatives (SALT) Conference in Singapore, U.S. hedge funds unanimously supported Geithner to replace Ben Bernanke.
Ben Bernanke is set to retire early next year. Federal Reserve vice-chairperson Janet Yellen and Larry Summers, who was the Treasury Secretary during Bill Clinton's leadership, were in the race to replace him. However, rising opposition from politicians and economists prompted Summers to back out. President Obama is expected to disclose his nomination for the next Federal Reserve chairman soon. Earlier, there were speculations that Larry Summers was the top choice of President Barack Obama.
Timothy Geithner would assure pro-stimulus measures
Delegates at the Skybridge Alternatives (SALT) Conference said that Timothy Geithner at the helm means pro-stimulus measures and more accommodative policies by the central bank, reports Sri Jegarajah of CNBC. Timothy Geithner was also present at the conference. But he avoided speaking directly if he was interested in being nominated as the next Federal reserve chief.
Morgan Stanley's vice chairman of wealth management division, Gary Kaminsky, said that hedge fund managers unanimously want Timothy Geithner to take the job if offered. They said Geithner leading the Fed will be the most bullish thing for the markets.
Timothy Geithner has little chance
In its latest policy meeting on September 17-18, the Federal Reserve decided to maintain its $85 billion a month asset purchase program. Markets were expecting the central bank to cut the stimulus by $10 billion to $15 billion a month. Nomination of the next Fed chief is being watched closely amid stimulus tapering concerns.
Though they favor Timothy Geithner, hedge fund managers believe there is little chance of him being nominated as the next Fed chief. He is likely to face strong opposition from Democrats, says John Lilley of Taurus Wealth Advisors.