The nomination of hedge fund executive Scott Bessent as Treasury secretary by President-elect Donald Trump has been widely praised by asset managers and other stakeholders.
David Bahnsen, managing partner and chief investment officer at The Bahnsen Group, which has more than $6 billion in assets under management, said Bessent is a “solid, dependable pick with a strong familiarity with financial markets and reliable ideological grounding.”
Unlike his predecessor Janet Yellen, Bahnsen noted, Bessent has “decades of experience on Wall Street, which is important given the significant debt and deficit challenges the U.S. is facing.”
Bessent currently serves as CEO and CIO of hedge fund Key Square Group, which he founded in 2015. Bessent formerly served as CIO for Soros Fund Management, the investment vehicle for the Soros family and their foundations, from 2011 to 2015.
Key Square has about $577 million in assets under management.
On Nov. 22, on his Truth Social account, Trump described Bessent as “widely respected as one of the world’s foremost international investors” and “a strong advocate of the America-first agenda.”
Trump further said Bessent will “support my policies that will drive U.S. competitiveness, and stop unfair trade imbalances, work to create an economy that places growth at the forefront.”
Others also chimed in with their approval of Bessent.
Donald A. Steinbrugge, founder and CEO of Agecroft Partners, an alternative investment consulting and marketing firm, said Bessent’s background as a hedge fund executive will likely boost the industry as a whole.
“Bessent’s appointment marks a significant win for hedge fund representation at the highest levels of government,” Steinbrugge said. Citing that some other major figures from the alternative investment industry also donated heavily to the Republican Party during this election, including Ken Griffin, CEO of Citadel and Stephen Schwarzman, CEO of Blackstone Group, Steinbrugge added that “these developments point to a hedge fund industry that is poised to wield unprecedented influence during Trump’s tenure.”
Citadel has about $65 billion in AUM, while Blackstone has more than $1 trillion.
Kenneth J. Heinz, president of HFR, the research firm that tracks the global hedge fund industry, called Bessent a “solid candidate” for Treasury secretary.
“Clearly the electorate has ushered in a mandate for change, and the incoming administration has implemented this by bringing in industry experts for the Cabinet roles, rather than bureaucratic career politicians,” Heinz said. “Bessent has strong experience and deep background in financial markets from the perspective of someone working in investing and trading, rather than ‘ivory tower’ economists lacking practical financial markets experience.”
Not surprisingly, U.S. Sen. Tim Scott, R-S.C., a member of the Senate Finance Committee as well as the Senate Banking Committee, commended his fellow South Carolinian, in a news release, saying Bessent will “usher in a tax code that enhances growth, investment and economic opportunity for all Americans.”
On Nov. 18 (prior to Bessent’s official nomination), Josh Wolfe, co-founder and managing director of venture capital firm Lux Capital, said on X: “America needs an experienced wise and smarter-than-other global finance heads so he can outsmart them, a Treasury Secretary who puts us first. A leader who gets tariffs, trade, and turning-the-tide back in our favor. Scott Bessent is definitely that guy.” Wolfe added: “Scott understands tariffs aren’t just a policy, they’re a power move. While others talk, Scott will make sure unfair trade practices pay up. Scott’s built relationships across the globe, not to placate but to dominate. He knows our adversaries and allies; they respect him. He knows how to leverage deals to bring foreign (money) into the U.S. and keep it flowing into our economy.”
Lux has more than $5 billion in AUM.
Indeed, Bessent is a strong advocate of slapping tariffs on various imports, in line with Trump’s views. In a Nov. 15 op-ed for Fox News, Bessent wrote that “tariffs have a long and storied history as both a revenue-raising tool and a way of protecting strategically important industries in the U.S.”
Trump has proposed a universal baseline tariff on all U.S. imports of 10% to 20% and a 60% tariff on all U.S. imports from China. If implemented, economists worry the tariffs will raise prices for American consumers and increase inflation.
Bessent also added in the op-ed that “other countries have taken advantage of the U.S.’s openness for far too long, because we allowed them to.”
Bessent is also committed to extending Trump’s tax cuts from 2017, which were set to expire at the end of 2025.
However, Bahnsen pointed out some of the challenges Bessent may face as treasury chief.
“While Bessent has said that he wants to reduce the budget deficit to 3% of GDP (gross domestic product) by 2028 and push real GDP growth to 3%, the deficit reduction is highly unlikely to occur without that stronger GDP growth,” Bahnsen said. “If GDP can grow at a steeper clip with deregulation and other pro-growth initiatives, then there's a higher likelihood of achieving Bessent's deficit goals.”
In addition, Bahnsen noted that Bessent also said he wants the U.S. to produce 3 million extra barrels of oil each day, “which is a difficult goal because I believe there is more at play with oil production than just government regulation, as oil companies are being very disciplined in their capital spending. Producing more oil requires oil companies to spend more on production infrastructure.”
