{"id":543033,"date":"2026-04-21T15:20:14","date_gmt":"2026-04-21T15:20:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/543033\/"},"modified":"2026-04-21T15:20:14","modified_gmt":"2026-04-21T15:20:14","slug":"kevin-warsh-trumps-ideal-choice-to-push-fed-to-cut-interest-rates-federal-reserve","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/543033\/","title":{"rendered":"Kevin Warsh: Trump\u2019s ideal choice to push Fed to cut interest rates | Federal Reserve"},"content":{"rendered":"

On the face of it, Kevin Warsh looks like an ideal candidate to chair the Federal Reserve<\/a>, the world\u2019s most important central bank. The 56-year-old Ivy League economist, former Wall Street banker and presidential adviser ticks all the boxes. Unfortunately for Warsh, as he faces what could be a fraught nomination hearing, his biggest backer is also his biggest liability.<\/p>\n

In his second term, Donald Trump has attacked the Fed in a manner both unprecedented and unseemly. He has called current chair Jerome Powell \u2013 whom he also appointed \u2013 a \u201cjerk\u201d<\/a>, \u201ca stubborn MORON\u201d<\/a>, and repeatedly threatened to fire him<\/a>.<\/p>\n

The tension comes from Trump\u2019s desire for lower interest rates. The problem: the president can\u2019t set interest rates.<\/p>\n

But Trump thinks he\u2019s found a saving grace in Warsh. Warsh is set to appear in front of the Senate\u2019s banking committee for his nomination hearing on Tuesday morning, where he is expected to be grilled by Democrats and Republicans alike.<\/p>\n

The hearing comes at a tumultuous time for the central bank. Trump\u2019s campaign against Powell, whose term ends on 15 May, has led to a criminal investigation<\/a> of his handling of renovations at the central bank\u2019s headquarters. At least one Republican senator said he will try to block Warsh\u2019s nomination until the investigation is dropped.<\/p>\n

Should he be appointed, Warsh will hold one of the most powerful roles in the US government with great influence over the US economy<\/a>. Here\u2019s what we know about him.<\/p>\n

Career in finance and adviser to Bush administration<\/p>\n

Warsh\u2019s career as an economist started in his undergraduate days at Stanford, where he studied under economist Milton Friedman, best known for providing the intellectual foundation for the era of free-market shareholder capitalism that took off in the 1970s.<\/p>\n

\u201cHe had a huge effect on not just me, but generations of students that followed,\u201d Warsh said in an interview<\/a>, adding that he was \u201cblessed\u201d to study under the economist.<\/p>\n

Warsh went on to get a law degree from Harvard before starting a career in financial services, working in mergers and acquisitions at Morgan Stanley.<\/p>\n

In 2002, he left his Wall Street job to become an economic policy advisor under George W Bush and the executive secretary of the National Economic Council.<\/p>\n

Warsh in 2002 married Jane Lauder, the granddaughter of Est\u00e9e Lauder whose eponymous cosmetics company made the family billions.<\/p>\n

An inflation hawk on the Federal Reserve<\/p>\n

Bush appointed Warsh, 35 at the time, to the bank\u2019s board of governors in 2006. As the 2008 financial crisis unfolded, Warsh helped broker the sale of Bear Stearns, the investment firm whose fall ushered in the financial crisis, to JPMorgan Chase.<\/p>\n

He also developed a reputation as an \u201cinflation hawk\u201d, a nickname given to economists who staunchly believe in raising interest rates to combat high inflation, even at the risk of higher unemployment.<\/p>\n

As a Fed governor, Warsh made it clear that he sees the Fed\u2019s role as one that deals exclusively with monetary policy and cautioned against the central bank slipping into \u201cfiscal\u201d territory \u2013 tax and spending decisions usually taken by the government.<\/p>\n

\u201cThe Fed, as a first-responder, must strongly resist the temptation to be the ultimate rescuer. No matter the congressional calendar or the pleadings of the elected,\u201d Warsh said in a 2010 speech<\/a>. \u201cThe Fed\u2019s credibility is severely undermined if it is perceived to wander from its mission into areas more appropriately handled by other parts of the government.\u201d<\/p>\n

Though he was appointed for a 14-year term, Warsh left his post on the board in 2011, partly due to disagreements over the Fed\u2019s post-financial crisis stimulus package.<\/p>\n

Since leaving the Fed\u2019s board, Warsh has served as a lecturer at Stanford Graduate School of Business Hoover Institution and as an adviser to billionaire investor Stanley Druckenmiller.<\/p>\n

A part of Trump\u2019s \u2018central casting\u2019<\/p>\n

Economists largely agree that an independent central bank is key to having a stable economy. But while previous presidents refrained from publicly criticizing the Fed to respect the central bank\u2019s independence from politics, Trump has treated Fed like a political enemy and made clear what decisions he believed it should take.<\/p>\n

Trump has praised Warsh since he was appointed in January, saying that Warsh will deliver the interest rate cuts he\u2019s been wanting since he started his second term.<\/p>\n

\u201cYou think [interest rates] will go lower this year?\u201d Fox Business\u2019s Maria Bartiromo asked Trump in an interview released last week.<\/p>\n

\u201cWhen Kevin gets in, I do, yeah,\u201d the president said.<\/p>\n

Earlier, Trump said that he made a \u201creally big mistake\u201d by appointing Powell in 2018 instead of Warsh, who reportedly interviewed for the job at the time, but was ultimately turned away.<\/p>\n

\u201cI have known Kevin for a long period of time and have no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best,\u201d Trump said in January. \u201cOn top of everything else, he is \u2018central casting\u2019, and he will never let you down.\u201d<\/p>\n

Before his nomination, Warsh made it clear that he believed interest rates should be lowered, saying in a November Wall Street Journal op-ed<\/a> that the central bank had \u201cbroken leadership\u201d that was shirking the economic growth brought on by the surge of artificial intelligence.<\/p>\n

\u201cThe world is moving faster, yet the Fed\u2019s leaders are moving slower,\u201d Warsh wrote. \u201cThey appear stuck in what Milton Friedman called \u2018the tyranny of the status quo\u2019.\u201d<\/p>\n

A long road to the Fed?<\/p>\n

Though Warsh has Trump\u2019s full support, his nomination has been caught between the battle between Trump and the central bank.<\/p>\n

Thom Tillis, a Republican senator from North Carolina, said he supports Warsh\u2019s nomination, but will block it until Trump\u2019s justice department drops its criminal investigation into Powell.<\/p>\n

Tillis\u2019s block will help Democrats who are unified in their opposition to Warsh. Republicans have a narrow 13-11 majority in the Senate banking committee, meaning if Tillis blocks Warsh\u2019s nomination, his confirmation will not advance to the full Senate for a vote.<\/p>\n

Democrats indicated<\/a> they also plan to go after Warsh\u2019s financial disclosures, which they say have not met the transparency standards that were met by other Fed nominees. Documents released before his hearing revealed<\/a> that Warsh has assets worth at least $100m, which would make him one of the wealthiest Fed chairs in recent history. Warsh disclosed the value of his assets but did not specify what holdings were in his largest investments, citing confidentiality agreements.<\/p>\n

Trump said last week that he would fire Powell<\/a> if the Senate does not confirm Warsh as Fed chair by 15 May, the end of Powell\u2019s term. But it\u2019s unclear if Trump will have the power to do so. Though the supreme court has given Trump broad executive powers in his second term, the court seemed skeptical<\/a> about Trump\u2019s firing of Fed governor Lisa Cook last summer, a case the court has yet to rule on.<\/p>\n

Even if Warsh is eventually confirmed, he alone cannot deliver the rate cuts Trump has been asking for. Though Warsh will have the most visible role on the board, he will have to convince the other 11 board members to cut rates, even as the Iran war has thrown the US economy into chaos.<\/p>\n","protected":false},"excerpt":{"rendered":"On the face of it, Kevin Warsh looks like an ideal candidate to chair the Federal Reserve, the…\n","protected":false},"author":2,"featured_media":543034,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[84,59,56,54,55],"class_list":{"0":"post-543033","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-business","9":"tag-gb","10":"tag-uk","11":"tag-united-kingdom","12":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/543033","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=543033"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/543033\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/543034"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=543033"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=543033"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=543033"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}