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Shelton one step from the Fed; Goldman partnership adds 60 new members

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Judy Shelton’s nomination to fill a vacant seat on the Federal Reserve Board “moved closer to confirmation Thursday after Senate Majority Leader Mitch McConnell set in motion the procedures needed to secure a final vote,” which could come “as soon as next week,” the Wall Street Journal reported. “Mr. McConnell’s decision suggests a high likelihood that she has the votes needed for confirmation, according to political analysts.”

Shelton was approved by the Senate Banking Committee back in July “on a party-line vote despite objections from Democrats.” She would fill a vacancy that runs through January 2024.

Judy Shelton, President Trump's nominee for governor of the Federal Reserve, listens during a Senate Banking Committee confirmation hearing in Washington on Feb. 13, 2020.

“Mr. Trump also nominated Christopher Waller, the research director at the Federal Reserve Bank of St. Louis, for a second vacancy, but Mr. McConnell hasn’t started the process that would bring him up for a full Senate vote. If both seats are filled this year, President-elect Joe Biden wouldn’t have any vacancies to fill on the seven-member board when he takes office in January.”

“Also on Thursday, Sen. Lisa Murkowski, R-Alaska — a key moderate whose support had not been assured — said she would back Shelton’s nomination,” the Washington Post said. “Just a few months ago, it was unclear whether Shelton had enough support among GOP senators to be confirmed.”

“Shelton’s confirmation could mark Trump’s final imprint on the Fed board before the Biden administration is inaugurated in January, giving the president another chance to shape the long-term direction of one of the government’s most powerful entities.”

“The confirmation of Mr. Trump’s two nominees would deny his successor, Joe Biden, an opportunity to quickly reshape the Fed board with his own appointments early on during his administration,” the Financial Times said.

Welcome to the club

Goldman Sachs “promoted 60 bankers into its partnership on Thursday, the fewest in two decades as Chief Executive David Solomon tries to restore the somewhat faded luster of Wall Street’s most elite club,” the Journal reported. “The group is marginally more diverse than in past years and heavier on coders, but still dominated by traders and deal makers. They ascend at an uncertain moment for Goldman, which is trying to remake itself from a Wall Street powerhouse into something of a financial superstore without losing its identity or its rainmakers.”

Women and ethnic minorities make up almost half of the new crop of Goldman Sachs partners, lessening the dominance of white men at one of Wall Street’s most exclusive clubs,” the FT said. “The latest group includes 32 white men, giving them a 53% share of the promotions, the smallest representation they have ever had. The share of new partners from Goldman’s traditional powerhouses of investment banking and trading has fallen to 66%, down from 71% two years ago.”

Wall Street Journal

Through the roof

The median price for existing homes rose in every one of the 181 metro areas tracked by the National Association of Realtors compared to last year’s third quarter. “This broad-based rally for single-family homes marked the first time since 1980 that every metro area tracked by NAR posted an annual price increase in the same quarter, NAR said. Back then, the association tracked 19 metro areas.”

“Prices in most markets weren’t simply edging higher but were up significantly from a year ago. In nearly two-thirds of the metro areas tracked by NAR, prices posted double-digit gains. Nationwide, the median single-family home price rose 12% from a year earlier to $313,500, NAR said.”

Financial Times

Making history?

If she is chosen by President-elect Biden, Federal Reserve Governor Lael Brainard “would break one of the most rigid glass ceilings in U.S. government: no woman has yet served as treasury secretary since the department was first run by Alexander Hamilton in 1789.”

“Her first mission would almost certainly be on the domestic front: ensuring that Mr. Biden’s ambitious economic agenda, including large-scale stimulus to jolt the recovery, can be passed in a divided Congress and properly implemented. But Ms. Brainard is also steeped in international expertise and relationships, which makes her a known quantity in finance ministries and central banks around the world.”

Quotable

“It means Republicans are taking it very seriously and Trump wants to get it done. People said, ‘Well, she’s not in the mainstream with all the other Fed economists.’ Well, that’s what we like about her. ... There’s this sense that everyone has to drink the same Kool-Aid at the Fed.” — Stephen Moore, an outside economic adviser to the White House who abandoned his own bid to fill a Fed seat, on the planned vote in the Senate on Judy Shelton’s nomination to the Fed.

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