President Obama’s nominee for Treasury Secretary, Jack Lew, does not exactly reflect the hope Wall Street bankers had that the president would go out of his way to reconcile with them.
Lew has little Wall Street experience. But he has spent the bulk of his career dealing with Washington’s fiscal issues.
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The markets shrugged off the news, which is better than anticipated from rumors circulating on the Street that Lew is a bad choice because of his lack of experience.
Leftover fiscal cliff issues are said to be what are holding back an advance in equities. If Lew can help Congress resolve those issues—particularly the debt ceiling issue—the markets could surge.
Market regulation will be waiting in the wings. The Dodd-Frank Act gave the Treasury Secretary a much larger regulatory role.
The economy is also more market driven than it was three decades ago. And Lew will have to earn the trust of bankers and high-profile investors.
Some are comparing the Lew choice with that of James Baker during the Reagan era. Baker had little experience with Wall Street but was ultimately viewed as a success.
Lew has the confidence of the president. Now he has to gain the confidence of Wall Street.