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Sep 14, 2013, 03.52 PM IST | Source: CNBC-TV18

'Summers the chosen one, but Fed safer in Yellen's hands'

It is pretty obvious that the White House wants Larry Summers, White House staff former Robert Rubin disciples want him and the President wants to go with someone they are comfortable with, but Janet Yellen is more experienced, says M Cary Leahey, Senior Advisor, Decision Economics.

Summers has a lot of extremely good skills but they are not the right skills perhaps for the Federal Reserve.

M Cary Leahey

Senior Advisor

Decision Economics

Larry Summers may be appointed as the next Chief of Fed as early as next week and M Cary Leahey, Senior Advisor, Decision Economics, believes it makes perfect sense. It is pretty obvious that the White House wants him, the White House staff former Robert Rubin disciples want him as well and the President wants to go with someone they are comfortable with, he adds.

Though he feels Janet Yellen will be better suited for the position because she is more experienced and more importantly she is going to get along a lot better with Congress and the other members of the FOMC than Summers will. "You probably want to keep Fed in safer hands, I think Yellen's hands are safer," he adds.

Below is the verbatim transcript of M Cary Leahey's interview on CNBC-TV18

Q: Let me start first by your reaction to that Nikkei article saying that Larry Summers is likely to be appointed as the Chief of Fed as early as next week?

A: I think that makes sense to me. The timing has been wrapped around the situation in the Middle East and if that is behind, you can move forward with Summers’ nomination. It is pretty obvious that the White House wants him, the White House staff former Robert Rubin disciples want him as well and the President wants to go with someone they are comfortable with. So it makes a lot of sense that there may not be the right decision but still make - no harder sense - that they will go with this Summers’ nomination perhaps as early as Thursday, September 19.

Q: That sounds like you preferred Janet Yellen, the other candidate in the race?

A: I get this feeling that outside of Wall Street, most people don’t want Summers but within the White House they do want Summers. So the answer is yes, Summers has a lot of extremely good skills but they are not the right skills perhaps for the Federal Reserve and if for no other reason you probably want to keep the Fed in safer hands, I think her hands are safer, she is more experienced and more importantly she is going to get along a lot better with Congress and the other members of the FOMC than Summers will. The typical FOMC member is now looking forward to getting their brow beaten by Larry Summers 8 times the year to make sure that they know that he is a smartest guy in the Federal Reserve.

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