Business executives have expressed their relief following the appointment of President-elect Donald Trump's choice for Treasury Secretary, a decision that has been deemed a prudent one after a series of more unconventional cabinet selections. Hedge fund manager Scott Bessent emerged victorious from an internal dispute over the coveted Treasury Secretary role, a position that will be met with immediate challenges and pressures. Bessent's background as an international investor, having collaborated with some of the most respected financial experts, along with his bipartisan support, has alleviated the concerns of both business leaders and financial markets. The Dow Jones Industrial Average climbed to an unprecedented peak of 44,737 on Monday, concluding the trading day with an increase of 440 points, or nearly 1%. The S&P 500 index edged up by 0.3%, while the Nasdaq Composite rose by 0.27%. Treasury bond yields dipped slightly, and the US dollar experienced a decline.

"There is a significant sense of relief," remarked Jeffrey Sonnenfeld, the founder and president of the Yale Chief Executive Institute. "Bessent is known for his reasonableness and pragmatism." Jamie Dimon, the influential CEO of JPMorgan Chase and a prominent figure on Wall Street, also holds Bessent in high regard. According to a source close to Dimon, he considers Bessent to be an exemplary selection for the role. At 62 years old, Bessent has had the privilege of working with some of the world's most distinguished investors, including the likes of Jim Rogers, Jim Chanos, Stanley Druckenmiller, and George Soros.

The role of Treasury Secretary is among the most critical appointments in any administration, particularly in light of Trump's emphasis on economic matters and the public's deep-seated dissatisfaction with living costs. Bessent is poised to serve as Trump's point person, tasked with implementing his economic strategy. Trump has chosen a candidate for this pivotal role who is not anticipated to provoke a contentious confirmation process.

Sonnenfeld, often referred to as "the CEO Whisperer" due to his extensive network of business contacts, stated that the hope of Corporate America is that Bessent can temper some of Trump's more aggressive campaign pledges that mainstream economists fear could reignite inflation. This includes mass deportations that could deprive key industries of labor, potentially impacting Federal Reserve policy and tariffs on all $3 trillion of US exports.

"Bessent advocates for the strategic use of tariffs. He is in favor of targeted tariffs. However, he understands that the Smoot-Hawley tariffs worsened the Great Depression," Sonnenfeld said, referencing the infamous 1930 tariffs enacted by Congress. "He does not wish to see a repeat of Smoot-Hawley."

Of course, even if Bessent advocates for moderation in Trump's discussions on tariffs and deportations, this does not guarantee that he will prevail in these debates, which will ultimately be decided by Trump himself. While investors are applauding Bessent's appointment, it is still too early to determine if he will also be a success for Main Street.

"Wall Street may be sighing with relief at Scott Bessent's nomination, but working people see no relief on the horizon," said Senator Elizabeth Warren, who is poised to be the leading Democrat on the Senate Banking Committee, in a statement on Monday. "Mr. Bessent's expertise lies in helping wealthy investors accumulate more wealth, not in reducing costs for families burdened by corporate profiteering."

During a radio interview with Larry Kudlow on Saturday, Bessent stated, "Tariffs cannot be inflationary because if the price of one item increases, unless you provide people with more money, they will have less to spend on other items, thus there is no inflation." He added, "Inflation occurs through either increasing the money supply or increasing government spending, and that is what happened under Biden."

Nevertheless, many economists continue to caution that tariffs—especially the across-the-board tariffs promised by Trump—will lead to higher prices. Goldman Sachs informed clients in a note on Sunday night that the greatest risks to inflation are tied to policy, particularly tariffs. The bank warned that a 10% across-the-board tariff could raise core prices by approximately 1% and delay the return to the Federal Reserve's 2% inflation target.

Bessent outperformed Cantor Fitzgerald CEO Howard Lutnick, who was also a contender for the Treasury Secretary position and had been endorsed by Elon Musk. Trump instead appointed Lutnick as Commerce Secretary, another significant role, albeit not as prominent as the Treasury.

"Lutnick is like a bull in a china shop. CEOs across various industries were concerned about Lutnick's temperament," Sonnenfeld commented.

Anthony Scaramucci, a finance executive and former Trump advisor who has since become a fierce critic of Trump, praised Bessent on X as a "great guy and a safe and stable pair of hands for the nation."

Jay Timmons, the CEO of the manufacturing trade group who in January 2021 called for Vice President Mike Pence to invoke the 25th Amendment to remove Trump from office, lauded Trump's decision to hire Bessent. "Scott's profound expertise in financial markets and his commitment to fostering economic growth make him an exceptional choice to lead the Treasury Department," Timmons stated shortly after Trump announced the selection.

Timmons expressed hope that Bessent, who criticized the Biden administration for "out-of-control government spending," will assist in fulfilling Trump's promise to extend the 2017 tax law. Left-leaning economists and progressives, however, have concerns about this very outcome.

Larry Summers, who served as Treasury Secretary during the Clinton administration, warned of a supply shock under Trump's economic plan in an interview with Fareed Zakaria that aired on Sunday. He argued that higher prices would be caused by even larger tariff increases than those implemented by Trump in his first term, as well as a labor shortage that affects farmers and homebuilding. Summers stated that he had "little doubt that the Trump program is a far greater stimulus to inflation than anything that President Biden enacted."

"Despite all his talk of looking out for working-class Americans, President-elect Trump's choice of a billionaire hedge fund manager to lead the Treasury Department shows that he just wants to maintain a rigged system that only benefits large corporations and the very wealthy," said Tony Carrk, executive director of the progressive group Accountable.US, in a statement on Friday. "Scott Bessent's first order of business will be to push for trillions of dollars in additional tax breaks for the well-off."