WASHINGTON (HedgeWorld.com)–President George W. Bush announced that he will nominate Kenneth Leet to become the next undersecretary of the Treasury for domestic finance.
The announcement came immediately after release of the resignation letter of the current occupant of that post, Peter Fisher.
In a statement, Treasury Secretary John Snow said that Mr. Fisher’s expertise “in financial markets has been invaluable as we faced challenges related to the terrorist attacks of Sept. 11 and the management of the nation’s debt during shifting economic times.”
Mr. Fisher had headed the Fed’s open market desk from 1994 until his appointment to the undersecretary’s position. He had acquired some notoriety from a central role in the privately funded rescue of Long-Term Capital Management Previous HedgeWorld Story.
Mr. Fisher said Wednesday that he is leaving because he believes a return to New Jersey will be good for his family. His period as head of domestic finance was a stormy one and might be best remembered for something he didn’t do: He offered no assistance to Enron in its final spiral toward insolvency and bankruptcy.
In late October and early November 2001, Mr. Fisher spoke repeatedly with Enron President Greg Whalley. Mr. Whalley wanted the undersecretary’ assistance in persuading banks to lend Enron more money.
That November, Mr. Fisher took a call on the same subject from former Treasury Secretary Robert Rubin, in his new capacity as one of the top executives at Citigroup. Mr. Rubin asked what Mr. Fisher thought of calling the debt rating agencies in order to prevent a downgrading of Enron’s debt rating. Mr. Fisher never made those calls.
Mr. Fisher will also be remembered for the Treasury’s decision to eliminate the 30-year bond.
His replacement, Mr. Leet, is currently managing director of the investment banking division at the Goldman Sachs Group Inc.
Concurrently with the announcement regarding Mr. Leet, the president also announced that he would nominate Susan Schwab, a dean at the University of Maryland, to deputy Treasury secretary, the second spot in the department. That post has been vacant since the departure of Kenneth Dam in February.