TLDR
- President Trump nominated Kevin Warsh as next Federal Reserve Chair to replace Jerome Powell when his term ends in May 2025
- Warsh served as Fed governor from 2006-2011 and was Ben Bernanke’s Wall Street liaison during the 2008 financial crisis
- The 55-year-old supports Trump’s push for lower interest rates and has called for “regime change” at the central bank
- Warsh wants to shrink the Fed’s balance sheet and believes this will create space for rate cuts from current 3.5-3.75% range
- Senate must confirm Warsh before he can take the position, with Republicans holding 53-seat majority
President Donald Trump announced Friday his nomination of Kevin Warsh to lead the Federal Reserve. The former Fed governor will replace Jerome Powell when Powell’s term as chair expires in May.
Trump posted the announcement on Truth Social. He praised Warsh as someone who “will never let you down” and called him “central casting.”
Warsh beat out three other finalists for the position. These included current Fed governor Chris Waller, BlackRock’s Rick Rieder, and National Economic Council Director Kevin Hassett.
The 55-year-old nominee currently works for investor Stanley Druckenmiller’s Duquesne Family Office. He is also a fellow at Stanford University’s Hoover Institution.
Warsh has extensive Federal Reserve experience. President George W. Bush appointed him as Fed governor in 2006.
He served until 2011. During the 2008 financial crisis, he acted as Fed Chair Ben Bernanke’s liaison to Wall Street.
Before joining the Fed, Warsh worked in mergers and acquisitions at Morgan Stanley. He also served as special assistant to President Bush for economic policy.
Trump first considered Warsh for Fed chair in 2017. That position ultimately went to Powell, a choice Trump later regretted.
Warsh’s Vision for the Federal Reserve
Warsh has been critical of Powell’s policies in recent months. He wrote in a Wall Street Journal op-ed that the Fed made “unwise choices” by missing persistent post-pandemic inflation.
The nominee supports Trump’s desire for lower interest rates. The Fed’s current short-term rate stands at 3.5-3.75% after officials held rates steady this week.
Trump has said the Fed should lower rates to 1% or less. Warsh believes cutting the Fed’s balance sheet will create room for rate cuts.
He has called for “regime change” at the central bank. Warsh views the Fed as insular and committed to outdated economic models.
Warsh argues that inflation stems from government overspending and excessive money printing. He rejects the idea that inflation comes from fast economic growth or rising wages.
He also believes tariffs should be viewed as one-off price changes. This view aligns with the White House position.
Senate Confirmation Process
The Senate must vote to confirm Warsh before he can assume the role. Republicans hold a 53-seat majority in the chamber.
Some Republican senators have said they won’t advance a nominee until a criminal probe into Powell is resolved. The confirmation process timeline remains unclear.
Once confirmed, Warsh plans to work closely with Treasury Secretary Scott Bessent. The two are longtime friends and share a mentor in Druckenmiller.
Warsh wants to strike a new deal giving the Treasury more authority over Fed balance sheet decisions. He argues the Fed endangered its independence by expanding into fiscal policy.
Powell will continue to hold his board seat after stepping down as chair. Some previous chairs have left their board seats when new leadership arrived.
Warsh will take the board seat currently held by Stephen Miran. Miran has been in the position since September while on leave from the White House.
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