{"id":112502,"date":"2021-11-23T10:45:00","date_gmt":"2021-11-23T15:45:00","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=112502"},"modified":"2022-11-21T09:49:33","modified_gmt":"2022-11-21T14:49:33","slug":"experts-react-to-fed-chair-powells-renomination-sound-tested-respected-and-familiar","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/experts-react-to-fed-chair-powells-renomination-sound-tested-respected-and-familiar\/","title":{"rendered":"Experts React To Fed Chair Powell&#8217;s Renomination: &#8216;Sound, Tested, Respected And Familiar&#8217;"},"content":{"rendered":"\n<p><strong>President Joe Biden&nbsp;<\/strong>announced Monday he will be renominating Federal Reserve Chairman&nbsp;<strong>Jerome Powell&nbsp;<\/strong>for a second term as Fed chair and will nominate Fed Governor Lael Brainard as vice chairman.<\/p>\n\n\n\n<p>Biden was widely expected to nominate either Powell or Brainard for the position of Fed chair. Powell was initially nominated by former President&nbsp;<strong>Donald Trump<\/strong>&nbsp;in 2017, but Trump was highly critical of Powell during his first term in the position.<\/p>\n\n\n\n<p>Powell served during the COVID-19 market crash in March 2020 and orchestrated the emergency interest rate cuts and implementation of $120 billion in monthly asset purchases to support the economy and provide liquidity to the financial markets during the subsequent economic shutdowns.<\/p>\n\n\n\n<p>Powell\u2019s critics have said the Fed has missed the mark with its expectations that the inflationary fallout from the Fed\u2019s stimulus measures would be \u201ctransitory.\u201d In November, the Labor Department reported a 6.2% increase in the consumer price index in the month of October, the fastest inflation growth since late 1990.<\/p>\n\n\n\n<p>However, the decision to stay the course with Powell was initially received positively by the market, as both Powell and Brainard are generally seen as relatively dovish policymakers.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-staying-the-course\"><strong>Staying The Course:<\/strong>&nbsp;<\/h2>\n\n\n\n<p><strong>George Ball<\/strong>, chairman of Sanders Morris Harris, said Powell is \u201csound, tested, respected and familiar\u201d for the market.<\/p>\n\n\n\n<p>\u201cWhile Powell&#8217;s continuance as Fed Chair will not spark a major fresh move upward in stocks, replacing him could have triggered major downward pressure on stocks, as investors dislike uncertainty and the unknown,\u201d Ball said.<\/p>\n\n\n\n<p><strong>Ryan Detrick<\/strong>, Chief Market Strategist for LPL Financial, said a second term for Powell should remove one source of worry for investors.<\/p>\n\n\n\n<p>\u201cAlthough this decision likely wasn\u2019t an easy one for the President, this should be greeted positively from markets,\u201d Detrick said.<\/p>\n\n\n\n<p><strong>Greg McBride<\/strong>, Chief Financial Analyst for Bankrate, said it\u2019s tough to change jockey\u2019s in the middle of a race.<\/p>\n\n\n\n<p>\u201cWith the Federal Reserve at an inflection point of starting to dial back stimulus, continuity at Fed Chair is key,\u201d McBride said.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Brainard\u2019s Impact:<\/strong>&nbsp;<\/h2>\n\n\n\n<p><strong>Joseph Brusuelas<\/strong>, chief economist for RSM US LLP, said Brainard will serve an important role in implementing a central bank digital currency.<\/p>\n\n\n\n<p>\u201cShe is clearly a bit more dovish on policy that Powell, who is a dove himself, and favors tougher regulation on the financial system which reflects the preferences of the Biden administration,\u201d Brusuelas said.<\/p>\n\n\n\n<p><strong>Jeff Klingelhofer<\/strong>, co-head of investments at Thornburg Investment Management, said Democrats should be pleased with Brainard as vice chair.<\/p>\n\n\n\n<p>\u201cWith elevating inflation concerns on just about everyone\u2019s mind, Brainard would have been more difficult for the market to digest as chair,\u201d Klingelhofer said.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges Ahead:<\/strong>&nbsp;<\/h2>\n\n\n\n<p><strong>Chris Zaccarelli<\/strong>, Chief Investment Officer for Independent Advisor Alliance, said continuity is critical for the markets and the economy at this time.<\/p>\n\n\n\n<p>\u201cThe economy is experiencing an increase in inflation and the Fed has already taken steps to reduce their extraordinary stimulus measures (tapering), but they will need to move more quickly in addressing the inflation threats so that they don\u2019t become entrenched,\u201d Zaccarelli said.<\/p>\n\n\n\n<p><strong>Robert Schein<\/strong>, chief investment officer, Blanke Schein Wealth Management, said the U.S. economy is strong and doesn\u2019t need near-zero interest rates and significant quantitative easing measures.<\/p>\n\n\n\n<p>\u201cWhile investors no longer have to wonder about who will be leading the Federal Reserve for the next few years, the next big dilemma the central bank faces is how to normalize monetary policy without upsetting markets,\u201d Schein said.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p>Originally Posted on November 22, 2021 &#8211; <a href=\"https:\/\/www.benzinga.com\/analyst-ratings\/analyst-color\/21\/11\/24233171\/experts-react-to-fed-chair-powells-renomination-sound-tested-respected-and-familiar\">Experts React To Fed Chair Powell&#8217;s Renomination: &#8216;Sound, Tested, Respected And Familiar&#8217;<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>President Joe Biden announced Monday he will be renominating Federal Reserve Chairman Jerome Powell for a second term as Fed chair and will nominate Fed Governor Lael Brainard as vice chairman.<\/p>\n","protected":false},"author":37,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18,6,8,9,26,3],"tags":[446,10676,10677],"contributors-categories":[13584],"class_list":{"0":"post-112502","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-macro","7":"category-north-america","8":"category-region","9":"category-securities","10":"category-text-articles","11":"category-traders-insight","12":"tag-federal-reserve","13":"tag-jerome-powell","14":"tag-lael-brainard","15":"contributors-categories-benzinga"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Experts React To Fed Chair 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