If, indeed, the administration had floated a trial balloon with Larry Summers' Fed Chairman candidacy, it appears to have been full of lead. Moments ago Fed mouthpiece Hilsenrath just undid the disturbance in the farce with an article that promptly crushed Larry's chances as Bernanke's replacement, instead putting Janet Yellen back up as the "front-runner for the top fed post."
Economists surveyed by The Wall Street Journal see Janet Yellen, the Federal Reserve's vice chairwoman, as the clear front-runner to succeed Ben Bernanke as the central bank leader when his term ends in January.
Thirty-five out of 42 economists said they expected Ms. Yellen to be President Barack Obama's nominee to run the Fed, beating out other possible candidates including Mr. Obama's former economic adviser, Lawrence Summers. Five respondents predicted Mr. Summers would get the nod.
Ms. Yellen also led a pack of potential candidates on measures of monetary-policy skills, communication skills and consensus-building.
"Yellen is highly qualified and has little baggage," said Nicholas Perna, of Perna Associates.
Economists said Ms. Yellen, a former economics professor and long-serving Fed official, was best qualified to make good monetary-policy decisions, and also gave her the highest marks among possible candidates on communication and forging consensus. However, her margins weren't as wide as they were when economists were asked who is most likely to get the job. For example, 13 out of 32 said she'd be best at forging a consensus.
This is merely a return to the status quo:
Ms. Yellen was the front-runner in January, the last time the Journal surveyed economists on the succession question. A Journal article last month highlighted Mr. Summers's past interest in the job. Mr. Summers is widely seen as a brilliant economist—the nephew of two former Nobel Prize winners—who has a reputation as a blunt leader.
As for Yellen's reported "drawbacks" - she will print even more:
Though Ms. Yellen is a front-runner, some economists say she has her drawbacks. Some critics see Ms. Yellen as too "dovish," meaning she might not fight inflation aggressively.
No wonder stocks just caught a modest bid just as the danger of not closing at an all time intraday high readers its ugly head.
As for Zero Hedge's own choice for Fed chairman...
Five private economists said Mr. Obama should choose Stanford economist John Taylor—a Republican and critic of the Fed's easy-money programs—for the top Fed job, though that seems highly unlikely.
Then again, at the end of the day the question may be a simple one: who worked at Goldman. And the answer is:
New York Fed President William Dudley, former Bank of Israel governor Stanley Fischer, and two former Fed vice chairmen, Roger Ferguson and Donald Kohn, also won some support across the metrics surveyed.
In other words we are back to a two horse race between Yellen, and the Fed's shadow head: Bill Dudley, with the ex-Goldmanite a substantial underdog. Recall that Mark Carney, another former Goldmanite, was considered a distant outsider too when the the UK shocked the world with his appointment to head the Bank of England thus cementing Goldman's grip over the world's three key central banks.
As for Larry...