Federal reserve governor Jerome Powell will be the one to get the nod to replace janet yellen, who actually was up for it. There is a mystery here, why replace janet yellen with basically what many experts see as her identical twin when it comes to the pace, you cant be if youre a guy, fraternal twin when it comes to the pace of Interest Rate hikes . Powell in lockstep with janet yellen on just about anything. What dont we been him that makes him President Trumps number one choice . Powell would be by the way the first fed chair in four decades without an advanced degree in economics. No ph. D. Either. He is a princeton grad, law degree from georgetown and wealthiest Federal Reserve chair since 1948 with a career spanning from wall street to washington. Hes been a fed governor since 2012, a former assistant treasury secretary i believe under Nicholas Brady and former partner at private equity firm the carlyle group. Charlie gasparino in the newsroom, way out in front of the fed chair sweepstakes. As we wait, what does Jerome Powell that janet yellen doesnt have that makes the president say hes my guy in step. He came in as a change president , why keep the same Federal Reserve chair even though we agree on a lot of stuff, when he was a Real Estate Investor loves low Interest Rates, loves easy money, not necessarily good for the economy. Savers get screwed on that, creates asset bubbles, a lot of bad impacts for continued easy money, i think where powell surpasses yellen on the trumpian scale is on deregulation. I think janet yellen was for the current regulation matrix of doddfrank, maintaining it, maybe even making it bigger and more impactful. Remember, the fed enforces much of doddfrank. Fed became an uber regulator following the financial crisis in 2008. Powell wants to pull that back. He said that in public statements. Hasnt been vociferous about it. If you parse through his statements, post 2008, hes called for some sort of a rollback of some of doddfranks excesses. Liz that actually, if im correct, has to be voted on by congress. I know they can verbally support. Na, na, na, smarty pants. Liz the fed writes that policy . The way doddfrank is written, take Something Like the volcker rule, thousands, many pages long, there is interpretive phase of the rules that the fed has to interpret. Some of it is locked in stone in terms of capital ratios and things like that. So much interpretation what the fed does with banks that you would have a guy that pushing for a more open interpretation, particularly on Something Like volcker which is all about banks, trading and proprietary trading and does add to the banks bottom line if they have a liberal view of it. But thats one aspect of it. Plenty more. And having the fed as the uber regulator pushing for regulation to change doddfrank wouldnt be necessarily the bad thing. Liz this is interesting, most people saying are my Student Loans going to spike . Thats a whole other thing. Liz whats the interest on the credit cards, about the rate hikes we are expecting but hell be at that moderate pace, correct, just like yellen . Hell be a yellen on that argument. Stocks for example, the economy, should stand on its own, not on whether the fed is printing money and somewhat devaluing the currency in that respect. You know, should the fed be the person, an entity that dictates whether you should buy stocks or bonds, remember, when you print money, keep Interest Rates low, that forces people to buy riskier investments, including stocks. Should the fed be in the business of doing that or should normalization occur where the stock market reflects not the fed Interest Rate policy of rates being very low but reflects the real economy and earnings. Theres a debate here, and one other thing the debate is in terms of the currency, you know, if you have a accommodative fed, its not the Gold Standard anymore. Liz not good for the u. S. Dollar. Is the fed going to protect the currency . These are all whats playing out . Thats why a lot of conservatives wanted john taylor as chairman. Pushing for kevin warsh, john taylor is great economist, there is something called a taylor rule, its about inflation and the gauge of inflation and kevin warsh is more along powell, he was a banker, he played a role in treasury. Liz let me jump in here, we have somebody right now in front of the cameras who has worked with and knows Jerome Powell, its dennis lockheart, the former atlanta fed president. I know you guys overlapped, mr. Lockheart, a couple of months, you know him, you know his thinking, what was your reaction that you heard that fox news confirmed it will be Jerome Powell . Well, we overlapped for the better part of five years, so i worked closely with jay powell particularly the last two years i was in the Federal Reserve. This is an outstanding appointment from my perspective. I think hes highly qualified. He can do all aspects of the job. I couldnt be more delighted. Liz ward mccarthy is always with us, ward was the chief economist for the Federal Reserve at richmond. Ward, people are wondering, how will this affect my money . And talk about mortgage rates. Talk about home equity lines of credit, and excuse me if i interrupt you, it will mean theyre coming out to speak. Nota worry. People should relax, he is not going to change the Interest Rate environment especially. Hes a moderate. Hes a really smart guy. Rates are going to be bleeding higher over the next few years, primarily because the economy is doing well and the fed is normalizing rates and normalizing the balance sheet. So that couple of years down the road, i think people will see higher rates but going to be a slow, gradual process, and nothing people should be panicked about. Liz okay, but the markets tend perhaps to move depending on the announcements. I want everybody to watch the lower ticker band. The dow up 29. Gotten the twominute warning, the nasdaq is down 7. Here they come. The russell 2000 is pretty much flat and watching an s p either been flat or lower. I think its important to note dennis to you, that as they walk out here, it appears it will be Jerome Powell for sure, and hold on one second, lets listen into the president of the United States to make the announcement of the changing of the guard. Pleased to welcome members of the cabinet, members of congress and distinguished guests to the white house rose garden this afternoon. Also i want to welcome the chairman of the Senate Banking committee whos done an incredible job, mike crapo. Wheres mike. Please, mike. Great job. Appreciate it. [applause] as president there are few decisions more important than nominating leaders of integrity and good judgment to hold trusted positions in public office. And few of those trusted positions are more important than the chairman of the Federal Reserve. Accordingly, it is my pleasure and my honor to announce my nomination of Jerome Powell to be the next chairman of the Federal Reserve. Congratulations, jay. Thank you, mr. President. Thank you. [applause] jay is joined here by his wife lissa and two sisters, monica and elizabeth, and i say congratulations to you all. Please, take that bow, please, you deserve it. [applause] thank you very much for being here. Today is another important milestone on the path to restoring Economic Opportunity for the american people. In just a short time, we have already made incredible strides, unemployment is at its lowest level in more than 16 years. You know that very well. You know that very well. Youre happy about it. Weve now it back to back quarters of 3 growth, a major accomplishment and were doing better and better every single week. But if we are to sustain all of this tremendous economic progress, our economy requires sound Monetary Policy and prudent oversight of our Banking System. That is why we need strong sound and steady leadership at the United StatesFederal Reserve. I have nominated jay to be our next federal chairman, and so important, because he will provide exactly that type of leadership. Hes strong. Hes committed. Hes smart. And if he is confirmed by the senate, jay will put his considerable talents and experience to work leading our nations independent central bank, which has the critical responsibility to set Monetary Policy and monitor our Banking System as a whole. There are few more important positions than this, believe me, in our government. Jay has served on the Federal Reserve board of governors since 2012, during his five years at fed. Jay has earned the respect and admiration of his colleagues for his hard work, expertise and judgment. He has proven to be a consensus builder for the sound monetary and financial policy that he so strongly believes in. Based on his record, i am confident that jay has the wisdom and leadership it guide our economy through any challenges that our great economy may face. Jay has earned the respect of members of congress straight across party lines. For each of his appointments to the fed, the Senate Confirmed jay with strong support from members of both parties. Thats unusual. I hope the senate will swiftly confirm him once again. Jay will also bring to the fed a unique background of prior business experience, he previously serve as undersecretary at the department of treasury in the administration of president george h. W. Bush, and just like William Mcchesney martin, the longest serving chairman in Federal Reserve history, jay will bring extensive private sector experience and real world perspective to our government. As a result, he understands what it takes for our economy to grow, and just as importantly he understands what truly drives american success. The innovation, hard work and dreams of the american people. I also want to thank the current chair, fed chair, janet yellen, a wonderful woman whos done a terrific job. We have been working together for ten months and she is absolutely a spectacular person. Janet, thank you very much. We appreciate it. For the past four years, she has served with dedication and devotion and we are grateful for her total commitment to public service. The Federal Reserve is one of the most important institutions in our government. It is respected all around the world, and is crucial to our economic prosperity. I am confident that with jay as a wise steward of the Federal Reserve, it will have the leadership it needs in the years to come. Thank you and god bless you all. Now i would like to invite jay to say a few words. Thank you. Thank you very much. [applause] thank you, mr. President. Thank you. Thank you very much, mr. President , for the faith that you have shown in me through this nomination, and im both honored and humbled by this opportunity to serve our great country. If i am confirmed by the senate, i will do everything within my power to achieve our congressionally assigned goals of stable prices and maximum employment. I want to thank my wife alyssa for love, support and wise counsel. Without here, i would not be standing here. Were thinking today of our three children and of the world theyre inheriting. My five siblings and i, two of whom are here with me are thinking today of our parents who gave us so many gifts, including most of all a loving home. In the years since the Global Financial crisis ended our economy has made substantial progress toward full recovery. By many measures were close to full employment, inflation has gradually moved up toward our target. Our Financial System is also without doubt far stronger and more resilient than it was before the crisis. Our banks have much higher capital and liquidity. Theyre more aware of the risks that they run and better at managing those risks. While post crisis improvement in regulation and supervision helped to achieve these gains, i will continue to work with colleagues to ensure the Federal Reserve remains vigilant and prepare to respond to changes in markets and evolving risks. To echo the president s remarks, ive had the great privilege of serving under chairman bernanke and chairman yellen who guided through difficult times while moving Monetary Policy toward Greater Transparency and predictability. Each of them embodies the highest ideals of public service, unflinching commitment to fulfilling mandate. Inside the Federal Reserve we understand that Monetary Policy decisions matter for American Families and communities. I strongly share that sense of mission and am committed based on the best Available Evidence in the longstanding tradition of Monetary Policy independence. Mr. President , thank you, again for this extraordinary opportunity to serve the american people. Thank you. Thank you, jay. [applause] thank you, everybody, thank you very much. Liz President Trump making it official Federal Reserve governor Jerome Powell will get the nod to be next Federal Reserve chief. He has to go through the whole process before congress, before he is accepted to that post, but the president thanking janet yellen who is the current Federal Reserve chief, very similar in outlook, in fact, he reiterated, i dont know if you heard that, he specifically reiterated everything the past four Federal Reserve chiefs before him have always said. We look to ensure stable prices and maximum employment. We are very close to maximum employment right now. As we look at the markets and the reaction, there is almost no reaction, we did see 11point gain on the Dow Jones Industrials on top of what we have already seen. Volatility is still very low for the vix. Interesting to see the 10year treasury yield remained steady with all of this. So it was widely telegraphed and expected certainly. No surprise, but we bring our guests back in one more time. Ward mccarthy, former economist at richmond fed and im sorry, atlanta fed president dennis lockheart and charlie gasparino. Dennis, i was asking you the question right beforehand, but did anything jump out at you that you wouldnt have expected here or pretty even toned . Nothing liz dennis first. Nothing surprised me in the comments. You know, the script that jay powell worked off of i think is pretty predictable and this appointment represents continuity, steadiness, i think those things are very important in this role, its as i said earlier, liz, its an outstanding appointment. Liz ward, we are expecting, when we looked at fed funds futures, which give us a sense what people are betting we will see at the next fed meeting in december. There is a strong possibility, 90 we will see another rate hike. Talk to our viewers right now. What will that mean if we see another couple of rate hikes or maybe three next year, what does that mean to credit card Interest Rates . We expect to see those go higher . There could be a whole bunch of reactions here. The rate, while student llorens fixed if federal, if private Student Loans, you might see higher student rates. Not big on the auto loan movement. Mortgage rates and Adjustable Rate Mortgages will move higher. Youre the economist, ward, what can we expect . We should expect that rates will go higher. Rates are extraordinarily lower and quite frankly as the economy continues to gain strength, those low Interest Rates will no longer be appropriate and could cause acceleration in inflation that nobody especially the Federal Reserve wants. Liz bingo. I think well get a rate hike in december, i think three next year as well, and i think that the entire yield spectrum will gradually drift higher over the next couple of years as the fed continues to pursue a normalized policy, but again, i think it will be a rather gradual process, and i dont think its going to be particularly disruptive, especially on the consumer side. Liz, i can make a point here . Listen Everybody Loves from a market standpoint, i can understand why our two guests like mr. Powell, hes smart, hes going to be continuation of janet yellen, but lets be real clear here, there is a counterargument here. The Federal Reserve has had very loose monetary policies since 2008, theres an argument they should have tightened sooner and they should normalize so the markets stand on their own, not stand on where the fed is, not stand what the fed is doing all the time, and, you know, also be real clear here, Jerome Powell is a smart guys, but hes n