Fed Chairman Candidate Larry Summers Could Be Less Keen On Quick Tapering Than Some Expect: Report

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Lawrence Summers is in the running to replace Fed Chair Ben Bernancke.

Larry Summers, a top candidate to succeed Ben Bernanke as Federal Reserve chair next year, is unlikely to scale back monthly bond purchases too quickly if appointed, reports the Wall Street Journal.

A WSJ analysis of Summers’ columns and speeches identified his skepticism about the benefits of massive quantitative easing, evidenced in the $85 billion monthly Fed bond purchases, but also highlighted his belief that the program does little harm, the report concluded.

Summers has preferred a broad tax-and-spend approach from the federal government, where tax increases and spending cuts are avoided, as arguably simpler and more effective than central bank engineering. He is an advocate of more federal infrastructure spending to boost the economy, according to the report.

Summers’ chief rival for the post is Federal Reserve Vice Chair Janet Yellen.

Fed officials met on Tuesday and Wednesday, and will release a statement at about 2 p.m. EDT on Wednesday. They’re expected to discuss tapering timing and how best to prepare skittish financial markets for that eventual scenario.

Most analysts and economists expect tapering to begin sometime between September and December 2013. Bernanke’s term ends in January.

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