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Yellen next Fed chair, and market will cheer: Pimco exec

Janet Yellen will be the next chair of the Federal Reserve, and the bond market will love it. At least, that's the case made by Tony Crescenzi, an executive vice president, market strategist and portfolio manager at Pimco.

Chairman Ben Bernanke is widely expected to step down when his term ends in January. Speculation was all but confirmed when President Barack Obama told Charlie Rose on June 17 that "Ben Bernanke's done an outstanding job" but "he's already stayed a lot longer than he wanted to or was supposed to."

So who will the next chair be?

"It can't be known," Crescenzi said on Thursday's "Futures Now," but "the odds are highly in favor of Janet Yellen to be the first woman Fed chair" on the strength of "all her experience at the Fed."

Since October 2010, Yellen has been vice chair of the Fed's Board of Governors. She had previously served as the president of the Federal Reserve Bank of San Francisco.

(Read more: Why Yellen should be next Fed chief: Former Fed official)

The case for Yellen may have gotten another boost from a letter going around in the Senate. Signed by a third of the Senate's 54 Democrats, it urges Obama to appoint her, The Wall Street Journal reported late Thursday.

Crescenzi believe that the bond market also would be a fan.

"The bond market would probably rather have Janet Yellen in place, with her vast experience at the Federal Reserve," he said. "She would probably keep in place the transparency effort of the Fed, and also its communications efforts. As well, it looks like she would likely continue Ben Bernanke's program."

Crescenzi added, "There are too many uncertainties regarding the other candidates," so choosing on of them could mean "extra yield that investors demand for bonds," and "it would mark equities down."

Joshua Roberts | Bloomberg | Getty Images

Yellen's main competitor for the position is thought to be Lawrence Summers, who served as director of Obama's National Economic Council and was the president of Harvard University. But Crescenzi is not too excited about that prospect.

"Bernanke forms his views around the consensus, and Yellen likely would, too. It's felt that Larry Summers, with his gravitas, might put the policy-making around his views rather than around the consensus," he said. "Some would dispute that idea, but that's a sense that some have."

(Read more: Battle of the sexes in search for new Fed leader)

The Summers bears got more ammunition Thursday, when the Financial Times reported that Summers said at a conference, "QE in my view is less efficacious for the real economy than most people suppose."

Comments like these lead Deutsche Bank Chief U.S. Economist Joseph LaVorgna to agree with Crescenzi about Summers.

"In terms of bond market response, yields could go much higher if Summers is chosen for Fed because recent economic remarks were bearish," LaVorgna tweeted on Friday morning (his ample use of hashtags has been omitted).

That said, if Cresenzi is right, a Summers appointment is not a likely enough outcome to be worth losing much sleep over.

—By CNBC's Alex Rosenberg. Follow him on Twitter @C NBCAlex.

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