Monday, July 8, 2013

WSJ Report: Larry Summers "Hellbent" on Becoming Fed Chairman

Larry Summers, a former top economic adviser to President Obama, is speaking, writing, consulting, advising, teaching and still in frequent contact with the president, and some of his friends say he is more than a little interested in the Fed job, reports WSJ.

WSJ continues:
Messrs. Obama and Summers explicitly discussed the possibility he could become Fed chairman in a private conversation at the end of 2010, as Mr. Summers was leaving his post as the director of the White House's National Economic Council, according to a person familiar with the matter.[...]A number of Mr. Summers's associates and current and former colleagues offered different takes on his current interest in the job. Some described him as hellbent on becoming Fed chairman, while others said he was apathetic, having moved on after being passed over before. Another group described him as somewhere in between.

Of note, in the WSJ article, Jonathan Gruber, an economics professor at MIT, is quoted as saying:
He's just an incredible combination of smart and caring.…I just think the world of someone who really really wants to get it done right and figures out how to do so.
But WSJ fails to point out that Summers may in reality not be that smart or caring. The Harvard endowment, when Summers was president of Harvard, lost substantial sums because of risky derivative positions that blew up on them.

Iris Mack, then working for Harvard Management, which managed the endowment, warned Summers about the position in an email. He refused to lower the risk and Mack was fired. The derivatives eventually resulted in major losses just has Mack had warned. Not too smart and not too caring on Summers part. Summers is an establishment crony who will just keep the Fed printing scam going on.

I'd rather see Mack, a Ron Paul supporter, who rose from the New Orleans ghetto to earn a PhD in applied mathematics from Harvard, as Fed chairman than Summers, whose pedigree can't match up with Mack's any step of the way. He was likely ruined as a child. He is  the nephew of two Keynesian Nobel laureates in economics: Paul Samuelson and Kenneth Arrow.


  1. Summers was born in New Haven, Connecticut, on November 30, 1954, into a Jewish family, the son of two economists, Robert Summers (who changed the family surname from Samuelson) and Anita Summers of (Romanian-Jewish ancestry), who are both professors at the University of Pennsylvania. He is also the nephew of two Nobel laureates in economics: Paul Samuelson (brother of Robert Summers) and Kenneth Arrow (brother of Anita Summers).

    Thank you for this tip. I did not know this.

    So, Summers' dad is Paul Samuelson's brother and Summers' mom is Kenneth Arrow's sister. This tidbit should be repeated much more often.

    I'm satisfied. There is no reason to think that Summers will not institute Rothbardian policies as Fed Chairman, right?

  2. It's not who succeeds Bernanke that we should be concerned with. It's that we have a private banking cartel price-fixing interest rates. It is the worst form of central planning, one intended to shield the big banks from their own greed and stupidity.

    Whoever takes over will most assuredly be yet another Keynesian who thinks a little more money printing will magically solve our economic woes. He (or she) will get it wrong, and the rest of us will pay dearly for it.