Scott Bessent is stepping out from behind decades of hedge-fund desks into the Treasury Secretary’s office with one goal: to leave his fingerprints on the global economy.
President Donald Trump has tapped the 61-year-old economic historian turned hedge-fund manager to take the reins at the Treasury Department. If Bessent’s past is any indication, he’s not here to play it safe.
Trump made the call late Friday afternoon, summoning Bessent to Mar-a-Lago. Within hours, the two were shaking hands, alongside Vice President-elect JD Vance and Chief of Staff Susie Wiles, strategizing on what could become the most aggressive economic policy change the U.S. has seen in decades.
From hedge funds to the Treasury
Bessent’s name carries weight, especially on Wall Street. For 40 years, he navigated global markets with precision, leveraging economic data and geopolitical chaos to make massive bets. At George Soros’s firm in the early 1990s, he played a key role in the now-legendary shorting of the British pound.
The event, dubbed “Black Wednesday,” raked in billions. Later, as Soros’s Chief Investment Officer, Bessent continued his streak, pulling in more than $1 billion with bold plays against the Japanese yen.
When he launched Key Square Capital Management in 2015, things started slower. His fund remained relatively unremarkable until 2022, when it gained a staggering 31% in its main portfolio. By 2023, Key Square was posting consistent double-digit returns.
This November has been the fund’s strongest month yet, largely because of its bet on a Trump re-election win boosting markets. For context, the S&P 500 rose 25% this year, but macro hedge funds like Bessent’s typically lag behind such numbers.
This track record earned him high-profile endorsements. Billionaire investors like Daniel Loeb and Bill Ackman openly applauded his nomination. Kyle Bass, another Wall Street heavyweight, declared on X (formerly Twitter) that Bessent was “the single best choice” for Treasury Secretary.
But not everyone was thrilled. Elon Musk called him a “business-as-usual choice” and pushed for Cantor Fitzgerald CEO Howard Lutnick instead. Trump, however, trusted Bessent to deliver results.
Bessent’s economic playbook
Bessent is coming armed with what he calls his “3-3-3” strategy, a nod to Japan’s former Prime Minister Shinzo Abe’s “three arrows” policy. Bessent’s version? Cut the budget deficit to 3% of GDP by 2028, drive GDP growth to 3% through deregulation, and boost domestic oil production by 3 million barrels per day.
But that’s just the beginning. Bessent wants to extend Trump’s 2017 tax cuts permanently. He’s pushing for the elimination of taxes on overtime pay, Social Security benefits, and even tips. To keep spending in check, he’s eyeing freezes on non-defense discretionary budgets.
On the green-energy front, he’s calling for reforms to electric vehicle subsidies and other programs tied to the Inflation Reduction Act. All of this is designed to reduce the federal debt, which Bessent views as an existential threat to the U.S. economy.
“We’re running out of time to grow our way out of this mess,” he reportedly told colleagues. Growth, in his view, is the only way to manage America’s bloated budget deficits and ballooning debt.
Tariffs as a weapon
If there’s one area where Bessent’s policies might rattle the global stage, it’s trade. Initially, he saw tariffs as more of a bargaining chip, likening them to a “loaded gun” rarely fired. But his stance has changed. He now advocates for higher tariffs on national security grounds, using them to pressure other countries into lowering their own trade barriers.
At a recent event titled “Make the International Economic System Great Again,” Bessent didn’t hold back. He criticized U.S.-China trade policy, accusing it of enriching Wall Street while hollowing out America’s industrial base.
He proposed turning tariffs into a tool as potent as Treasury sanctions, rewarding allies that reform and punishing competitors that don’t play fair.
“President Trump is right that actual free trade is desirable,” Bessent said during the event. But to get there, he believes a more aggressive, activist approach is essential. His idea? A fair-trade bloc for countries that share U.S. security interests and adopt reciprocal tariff structures.
The man behind the policies
Reports say Bessent is reserved, professorial, and deeply steeped in economic history. A Yale graduate, he once taught at the university, diving into obscure financial analogues to inform his market strategies. Colleagues describe him as methodical, someone who digs into the past to predict the future.
That perspective played a significant role in his rise as one of Trump’s closest economic advisers. During the campaign, Bessent provided depth to Trump’s proposals, backing controversial ideas like activist trade policies with historical precedent.
His ability to merge the past with the present made him an indispensable voice in the president’s circle. Personally, Bessent keeps a relatively low profile. Since 2020, he’s lived in Charleston, South Carolina, with his husband, John Freeman, a former New York City prosecutor, and their two children.
Critics argue that his Wall Street pedigree might blind him to broader economic issues, but his supporters believe his expertise is exactly what the job needs.
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