Just when we thought we had the Federal Reserve chair reality show all figured out (it's gonna be Warsh, people), a dark horse contender has entered the ring. No, not the guy who wants to teach Ayn Rand to toddlers. And no, not the only guy in Washington who reads less than Trump. Instead, says Jeff Gundlach, we should be on the lookout for none other than the Monetary Menace from Minneapolis, the Neel Deal, Mister Neel Kashkari:
"I actually have a very non-consensus point of view. I think it's going to be Neel Kashkari," the the CEO of DoubleLine Capital told the Vanity Fair New Establishment Summit on Tuesday in Los Angeles. "He happens to be the most easy money guy that's in the Federal Reserve system today and that's why he may win."
Kashkari's low-rates bona fides aren't all he has going for him. As we've discussed before, the Minneapolis Fed prez has a number of qualities that might appeal to Donald Trump for Fed chair, from an active Twitter life to a disdain for convention to a willingness to entertain breaking up the banks. But these are just matters of style. What counts is policy. And that's where Trump and Kashkari really jibe:
“I think the President, if he’s going to retain his base, needs to deliver something to the disaffected middle class,” Gundlach said. “A stronger dollar is not good for achieving that agenda. A weak dollar is actually positive. And easy money is more a friend of a weak dollar than tight money.”
While we would delight in a Neel Kashkari Fed chairmanship – if only for the inevitable Dimon-Kashkari blog beefs – the odds are long. As CNBC reports, Kashkari's name is not among those that have been presented for Trump's thoughtfulconsideration. Kevin Warsh and newcomer to the race Jay Powell are the likeliest picks, especially now that Janet Yellen's attempts at ingratiation have apparently fizzled. This is despite Warsh's decidedly anti-low-rates outlook and Powell's establishment position.