But those two top contenders combine for lower than 50 percent odds in our expert survey — meaning that our panelists thought there was a better-than-even chance that the appointment will be one of many contenders with individually modest but collectively high chances of rising to the top of the president’s list.
Compared with PredictIt, an online marketplace based on news events, our experts saw slightly lower odds for either of them. On Thursday afternoon, trading on PredictIt implied 30 percent odds for Ms. Yellen and 28 percent for Mr. Warsh.
Using our expert survey — and comments from some of the participants in it — here’s a guide to President Trump’s options as he makes perhaps the single most consequential economic decision of his first year in office.
Yellen reappointment: continuity and bipartisanship
There’s a tradition of reappointing Fed chairmen who were originally appointed by a member of the opposite party. President Obama did so with Ben Bernanke; Bill Clinton with Alan Greenspan; and Ronald Reagan with Paul Volcker.
That tradition has helped keep the Fed, with its vast power over the economy and financial system, insulated a bit from politics, but President Trump has no obligation to follow it.
The case for renominating Ms. Yellen is straightforward.
She has presided over four years of steady economic expansion and rising financial markets. She moved cautiously toward raising interest rates even though the economy seemed to be approaching full employment. By contrast, some more conservative contenders for the job have indicated they want to raise rates more quickly, which could endanger the economy as President Trump approaches midterm elections in 2018 and a potential re-election battle in 2020.
After criticizing her during his campaign, President Trump has had some kind words for her, saying in July that he liked her and that “she’s done a good job.”
Moreover, as President Trump dabbles in making deals with Democrats, reappointing Ms. Yellen could serve as an expression of good faith to Democratic senators. As administration officials focus on tax legislation and other priorities on Capitol Hill, it might be helpful to them to nominate someone who might sail through confirmation, rather than demand a bruising, time-consuming battle.
“She’s a known quantity, and there is less risk of disrupting the financial markets if the president renominates Dr. Yellen,” said Brian…