In the first encouraging thing I have seen from Barack Obama since he was elected President, Timothy Geithner, President of the Federal Reserve of New York, was appointed Treasury Secretary today.  Though I am sure a fair amount of the post hoc ergo propter hoc fallacy is being committed here, the market rallied 500 points after the news (wiping out all of yesterday's loss and a small amount of the loss from Wednesday).  I actually think today's late rally had more to do with shorts taking their massive profits from the week off the table as they went home for the weekend, but I digress.
 
Reagan didn't win the election, so I was not expecting a Laffer-led Supply-Side team to run Treasury.  My economic heroes are either dead (Friedman), hosting cable shows (Kudlow), appearing on cable shows (Laffer and Forbes), or fuming at Bush (Hubbard and Bartlett).  But if one as leftist as Obama is going to pick a Treasury Secretary, the least a supply-side, monetarist, Chicago school, Republican like me can hope for is to get a free trader and strong dollar proponent.  All indications are that we got that.  Jack Kemp, he is not, and he clearly is going to be more of a market interventionist than I like (though to suggest that Paulson, Snow, and O'Neill were not is rather naïve, and in the case of Paulson, an insidious lie).  But a market interventionist whom is ambiguous about tax policy yet known as a dollar bull and free trade advocate is better than a pro-tax protectionist.
 
I suspect Larry Summers' name is going to stay in the headlines.  I hope Volcker is summoned for counsel to some degree as well.  Few people understand the reality of business cycles more than Volcker, and I suspect that Schumpeter's "creative destruction" is going to be a part of life for some time.  Inflation hawks like Volcker may seem unnecessary in deflationary recessions like this one, but I do not believe that will last.  Obama is wise to surround himself with people that have an economic worldview more sophisticated than his own, which, by the way, could include Mitchell Bahnsen as well (age 3.5; weight 29 lbs.).
 
All things considered, Geithner is a well-respected intellectual who has swam around in very rough waters much of his career, and is regarded by many friends of mine as a capable thinker, and independent mind, and a capable resource.  Good work, Mr. President.  =)
 
Now, about that Secretary of State pick?