The US markets reacted positively to President-elect Donald Trump’s nomination for the Department of Treasury an investor and hedge fund manager billionaire.
The US stock markets started the week positively on Monday, as the Dow Jones rose 0.99 percent to over 400 points, reaching a new record, while the S&P 500 climbed 0.30 percent, and the Nasdaq 0.27 percent.
Trump said that Scott Bessent will help him usher in “a new Golden Age for the United States,” with his Truth Social platform emphasizing that Bessent will support Trump’s policies.
According to Turkish news service, Bessent told the Wall Street Journal (WSJ) that his priority would be to fulfill Trump’s promises for tax cuts, which includes making Trump’s first term tax cuts permanent and eliminating taxes on tips, social security benefits, and overtime pay.
The WSJ reported that Trump selected because of confidence that Bessent can carry out the second Trump administration’s policies.
US media outlets reported that Bessent advised Trump to follow his “3-3-3” plan, which includes reducing the ratio of budget deficit to gross domestic product (GDP) to 3 percent by 2028, increasing GDP growth to 3 percent via deregulation, and boosting energy production to an additional 3 million barrels of oil or equivalent on a daily basis.
The plan was inspired by former Japanese Prime Minister Shinzo Abe’s three arrows, also known as Abenomics, which incorporated fiscal stimulus and structural reforms, as well as aggressive monetary policy, to rescue the Japanese economy from recession and deflation.
The US stock markets started the week positively on Monday, as the Dow Jones rose 0.99 percent to over 400 points, reaching a new record, while the S&P 500 climbed 0.30 percent, and the Nasdaq 0.27 percent.
Besides the stock market, the US bond futures also increased after Trump’s win in the presidential elections, since his policies were generally considered to be positive for growth by large corporations while giving rise to inflationary pressures, which could mean that the Fed may cut rates slower than expected.
Analysts noted that Bessent was perceived by investors to be tough on government spending but more balanced on tariffs, as someone who will support the stock market with his pro-market views, and someone who can soften Trump’s aggressive policies.
Although investors are concerned that Trump’s tariffs could lead to more inflation, Bessent is believed to implement tariffs more “gradually,” analysts added.
Bessent, 62, worked for private investment banks after his graduation from college and worked at billionaire George Soros’ Soros Fund Management firm in 1991, taking a leading position at his London office the next year and helping the firm earn more than $1 billion in profit.
He taught history of economy at Yale from 2006 to 2010 and he founded the Key Square Capital Management firm with Michael Germino in 2015.
Bessent needs to be confirmed by the Senate before he assumes his post. If confirmed, Bessent will become the Secretary of the Treasury and he will be responsible for establishing and monitoring monetary policies, imposing sanctions, and supervising the sale of government bonds worth trillions of dollars.
