'SERIES OF MISTAKES': Trump's Fed pick rips apart Powell's 'poor track record'

Market Reactions - The yield on the 10-year Treasury is up 1.5 basis points, currently at 4.28% [1] - Markets are responding to President Trump's nomination of Kevin Worsh for the Federal Reserve chairman position [1] Federal Reserve Insights - Kevin Worsh criticized the Fed's track record on economic growth and inflation forecasting, suggesting that until there is a regime change at the Fed, old mistakes will persist [1] - Federal Reserve Governor Steven Myer supports Worsh's nomination, highlighting his respect in the financial industry and among policymakers [1] Interest Rate Expectations - The market anticipates at least two rate cuts from the Fed in 2026, with some expecting three [1] - Myer believes that more than a point of interest rate cuts is necessary, arguing that current inflation data may be distorted [1][2] Deregulation and Economic Growth - Myer emphasizes that deregulation can enhance productivity and reduce inflation by easing supply chain constraints [2][3] - He quantifies that continued deregulation could lower inflation by about 0.5% annually, presenting a significant disinflationary force [5] Producer Price Index (PPI) Concerns - The December producer price index showed a monthly gain of 0.5%, with a year-over-year increase of 3% [6] - Myer notes that the Fed targets consumer prices rather than PPI, which can distort the perception of inflation [8][9] Balance Sheet Management - Myer advocates for further reduction of the Fed's balance sheet, contingent on regulatory reforms to reduce demand for reserves [22][23] - He expresses optimism about the potential for balance sheet reduction under Worsh's leadership, linking it to a deregulatory agenda [23] Employment and Technological Change - Myer acknowledges the impact of AI on job displacement but believes new job categories will emerge, similar to past technological advancements [19][20] - He asserts that the Fed has a role in accommodating the transition to new job opportunities created by innovation [19]