US EditionTrump’s Fed Pick Kevin Warsh Could Shock Markets with 100 Bps in Rate Cuts This Year, Economist Says
Trump's pick, favored by Wall Street, raises questions about Fed independence amid a DOJ probe of current chair Jerome Powell, with economists expressing mixed views.
- On February 1, 2026, President Donald Trump nominated Kevin Warsh to lead the Federal Reserve, with reactions pouring in within minutes of the announcement.
- Kevin Warsh, former Fed governor , is well-connected on Wall Street and began calling for lower rates after Trump's 2024 return.
- Among investors and economists, responses ranged from congratulations to demands for scrutiny as Mohamed El-Erian praised Warsh's expertise, while Paul Krugman criticized the nomination and Jason Furman urged Senate questions.
- Warsh may seek to shrink the Fed's $6.6 trillion balance sheet, but his influence is constrained by the FOMC's 12-voter structure, while Sen. Thomas Tillis said he will block confirmation until the Powell probe is resolved.
- Historians recall Arthur Burns's era under Nixon as a warning, as Burns engineered a 10% expansion of the money supply— the crucial question is whether Warsh can avoid becoming Burns and preserve Fed independence.
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35 Articles
Padilla, Schiff Vow to Oppose All of President Trump’s Nominees For Federal Reserve Board
YouTube@CNBC Television California Senators Alex Padilla and Adam Schiff are speaking out against President Trump’s pick to head the Federal Reserve Board. The two Democrats say they do not support the nomination of Kevin Warsh. They are also vowing to “oppose every one of his nominees” to the board, until Trump agrees to keep the fed independent. Padilla and Schiff claim the president is engaged in a “war on the Fed and its independence.”
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Donald Trump has nominated Kevin Warsh as Chairman of the Federal Reserve (Fed), a monetary policy geared to the development of inflation. Nevertheless, Trump combines the hope of early interest rate cuts with personality. Will Warsh give in to the President's demands?
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