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Scott Bessent: President Trump’s Likely Treasury Secretary

Billionaire Hedge Fund Manager Favourite to Land Position

Emmanuel Eze

November 7, 2024

As President Trump and his supporters revel in his electoral victory and return to the White House as the 47th President of the United States of America, speculations over potential appointments into key government positions are rife. Amongst these key positions is the position of the Treasury Secretary, one of the key government positions in the US.

A major contender to emerge as President-Elect, Trump’s potential Treasury secretary is Scott Bessent, a hedge fund manager who has served as an economic adviser to the former president in the past and a top fundraiser for the Trump campaign team.

Who truly is this man touted by many to emerge as Trump’s Treasury secretary, a man described by Trump as “one of the top analysts on Wall Street”?

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Background

Scott Bessent was born in Conway, South Carolina in 1962. He attended Yale College, graduating in 1984 at the age of 22. While at Yale, Bessent wrote for The Yale Daily News, was president of Wolf’s Head Society, and treasurer for the Yale class of 1984.

Career

As a student, Scott Bessent interned with Jim Rogers. After graduation, Bessent worked at Brown Brothers Harriman, Kynikos Associates, and others.

In 1991, Bessent joined Soros Fund Management (SFM) and was a partner there throughout the 1990s, eventually becoming the head of their London office.

In 1992, Bessent was a leading member of the team whose bet regarding the collapse of the British pound garnered over $1 billion for the firm. After resigning from SFM in 2000, Bessent founded a $1 billion hedge fund.

The fund closed in 2005 with Bessent saying he learned that he shouldn’t change his style or the construct of the firm because of investor preferences. He also served as a senior investment advisor at fund-of-funds Protégé Partners.

In 2011, Bessent returned to SFM as Chief Investment Officer. He served as SFM’s CIO until 2015 when he left to begin a new firm, Key Square Group.

Fortune

Scott Bessent made his fortune betting against the Japanese yen with liberal philanthropist George Soros of Soros Fund management. His bet against the Japanese Yen in 2013 brought additional profit to the company and made Bessent a Billionaire.

Bessent gambled that the value of the yen would fall while Japanese shares would rise. Japan’s benchmark Nikkei 225 index thereafter jumped by 28%, making Bessent a Billionaire.

Key Square Group

Bessent founded Key Square Group in 2015 with Michael Germino, who had been the global head of capital markets at SFM, Key Square uses Geopolitics and Economics to make macro investments.

At inception, Key Square received a $2 billion anchor investment from George Soros. At the end of 2017, Key Square’s assets were $5.1 billion with Bloomberg reporting in May 2018 that Key Square had mostly outperformed rival macro managers and continued to generate significant investor interest.

Political Activities

Scott Bessent’s interaction with the political class in America dates back to 2000 when he hosted a fundraiser for Al Gore at his East Hampton, New York home.

In 2016, Bessent donated $1 million to Donald Trump’s Presidential campaign, and in February 2024, Bessent hosted a fundraiser in Greensville, South Carolina that raised nearly $7 million for Donald Trump’s 2024 campaign.

In April 2024, Bessent was a host for a Palm Beach, Florida fundraiser that raised $50 million for the Trump campaign. Bessent has been a key economic advisor to President Trump and has a warm relationship with the newly elected US president.

While Bessent has long favored the laissez-faire policies that were popular in the pre-Trump Republican Party, he has also spoken highly of Trump’s use of tariffs as a negotiating tool. He has praised the president-elect’s economic philosophy, which rests on a skepticism of both regulations and international trade.

Earlier this year, he floated the idea of nominating a “shadow” chair of the Federal Reserve, who would not sit on the US central bank’s policymaking committee but would give guidance on the future direction of monetary policy. Such an unprecedented move would undermine the influence of Jay Powell, the current Fed chair.

It is therefore not surprising that he is reportedly a candidate for the position of United States Treasury Secretary in President Trump’s second administration, He has also proposed a three-point economic plan for Trump modeled on Japanese Prime Minister Shinzo Abe’s “Three Arrows” economic policy.

Other Candidates For the US Treasury Secretary Position

John Paulson

Paulson is another billionaire hedge fund manager and major Trump donor. He has also informed associates of his interest in the position.

A longtime proponent of tax cuts and deregulation, Paulson’s profile is broadly similar to that of other potential members of Trump’s economic team. He has publicly supported targeted tariffs as a tool to ensure U.S. national security and combat unfair trade practices abroad.

Larry Kudlow

FOX Business Network personality Larry Kudlow, who served as director of the National Economic Council for much of Trump’s first term, has an outside shot at becoming his treasury secretary and would likely have an opportunity to take a separate economics-focused position if he is interested.

While he is privately skeptical of broad tariffs, there is publicly little daylight between the policies Kudlow advocates and those of the president-elect.

Robert Lighthizer

A loyalist who served as Trump’s U.S. trade representative for essentially the then-president’s entire term, Lighthizer will almost certainly be invited back. Though Bessent and Paulson likely have a better shot at becoming treasury secretary, Lighthizer has an outside chance, and he might be able to reprise his old role if he’s interested.

Like Trump, Lighthizer is a trade skeptic and a firm believer in tariffs. He was one of the leading figures in Trump’s trade war with China and the renegotiation of the North American Free Trade Agreement, or NAFTA, with Mexico and Canada during Trump’s first term.

Howard Lutnick

The co-chair of Trump’s transition effort and the longtime chief executive of financial services firm Cantor Fitzgerald, Lutnick is in the running for treasury secretary.

A bombastic New Yorker like Trump, Lutnick has uniformly praised the president-elect’s economic policies, including his use of tariffs.

He has at times given elaborate, unvarnished opinions about what policies will be enacted in Trump’s second term.

Some Trump allies had privately complained that he too often presented himself as speaking on behalf of the campaign.

Conclusion

With President Trump expected to be sworn in on January 20, 2025, Americans and the whole world wait with bated breath to find out who will be appointed to the position of the Treasury secretary, one of the most powerful positions in America.