Stocks rallied as news leaked out that President-elect Joe Biden has selected Janet Yellen as his Treasury Secretary.
President-elect Joe Biden’s choice of Janet Yellen as Treasury Secretary was seen as a win for markets, since the former Federal Reserve chair should focus on fixing the economy rather than the progressive Democratic agenda feared by some investors. The first woman Fed chief would also be the first woman Treasury Secretary and faces unprecedented challenges of massive unemployment and a record level of debt, as the government spends even more to reverse the impact of the pandemic during the Biden administration. «To me it shows Biden is taking stuff pretty seriously and definitely not pandering to the left. She’s a very serious economic thinker, and they have some very serious problems to deal with,» said Barry Knapp, director research for Ironsides Macroeconomics. The stock market rallied and financial stocks moved to the highs of the day as news of her pending nomination leaked out. Sources familiar with the matter told CNBC Monday afternoon that the president-elect had chosen Yellen, who was believed to be under consideration along with Fed Governor Lael Brainard and former Fed Vice Chair Roger Ferguson. «There’s so many outcomes that could have been worse for the banking sector. For me that was the real risk of that Treasury secretary appointment was you could get someone that was hawkish on the banking sector,» said Knapp. One market fear was that Biden could have nominated someone like Sen. Elizabeth Warren, D-Mass., who is outspoken about regulating banks.
