Saturday, November 23, 2024

Scott Bessent: Trump’s new treasury pick who made fortune helping George Soros bet against pound

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For a time, Howard Lutnick, the former head of financial services company Cantor Fitzgerald, seemed the likeliest option. Elon Musk, the Tesla billionaire and close Trump ally, had openly lobbied the president-elect to choose him.

But Mr Trump did not, reportedly souring on Mr Lutnick as he jostled with Mr Bessent for the role, with the pair criticising and briefing against each other for the role.

Mr Lutnick was given the Commerce Secretary role this week, in what appeared to be a consolation prize. Mr Bessent came out on top and will see his defeated rival around the Cabinet table.

It also raises questions about Mr Musk’s influence, who not only praised Mr Lutnick but has criticised Mr Soros as a threat to “the very fabric of civilisation”.

Mr Bessent, a 62-year-old South Carolina native, has made a career at the side of Mr Soros betting against currencies – and winning.

He reportedly joined Soros Fund Management in London in the early 1990s as its head of global research, a year before Mr Soros’ short of the pound. He is said to have played a behind-the-scenes role in the bet.

One figure who reported to him described Mr Bessent as “one of the few guys who wasn’t scared” of Mr Soros, describing the pair as a “pretty powerful combination”.

In fact, the 62-year-old rarely had as much success without the backing of his protege when he sought to branch out in later years.

Bessent ‘widely respected’

In 2000, Mr Bessent is said to have launched Bessent Capital with some $200 in capital from his former boss.

Forbes reports that this wound down some six years later, and he rejoined Soros Fund Management in 2011 as chief investment officer.

In that role, he is said to have helped net billions for the firm in betting against the Japanese yen and the pound’s decline following the Brexit vote in 2016.

He parted ways with Mr Soros again in 2017, raising some $4.5 billion to form Key Square Capital Management – this time with $2 billion from Mr Soros.

Reuters suggests that the fund’s uneven performance may have scared away investors, which saw its assets shrink from some $5.1 billion at the end of 2017 to some $577 million in December 2023.

Nevertheless, Mr Trump declared that Mr Bessent was “widely respected as one of the world’s foremost international investors and geopolitical and economic strategists” as he confirmed his nomination.

As Treasury secretary, he will “usher in a new Golden Age for the United States, as we fortify our position as the world’s leading economy, centre of innovation and entrepreneurialism, destination for capital”, Mr Trump continued.

“Unlike past administrations, we will ensure that no Americans will be left behind in the next and greatest economic boom.”

Mr Bessent has previously declared that the US under Mr Trump would “bring back manufacturing”, establish “energy dominance”, and bring about a “technology boom”.

In a Wall Street Journal piece last month, he advocated for the president-elect to pursue deregulation and tax cuts while addressing debt levels, which he blamed on “four years of reckless spending” under Joe Biden, the US president.

However, commentators noted that he did not make any mention of tariffs in the piece – one of Mr Trump’s flagship campaign promises.

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