We've got a Fox Business alert. The president responded to a question on his nomination of Kevin Worsh as Fed chair. Listen.>> Did Kevin Walsh commit to you that he will push to cut interest rates if he is confirmed. >> No. But we talk about it and I've been following him and I don't want to ask him that question.I think it's inappropriate. Probably it probably would be allowed, but I want to keep it nice and pure. But he certainly wants to cut rates.I've been watching him for a long time. Okay, let's go ar ...

President Donald Trump on Jan. 30 nominated Kevin Warsh to lead the Federal Reserve and an increasingly divided Federal Open Market Committee once Chair Jerome Powell’s term ends in May. Warsh served on the Fed’s Board of Governors for five years from 2006 to 2011, including during the U.S. financial crisis. During that time, he was seen as a bridge to Wall Street and pegged as a hawk, meaning he favored keeping interest rates high to curb inflation. However, Warsh has recently appeared more dovish, sidin ...

Core Viewpoint - The discussion centers around the potential appointment of Kevin Hasset as the next Federal Reserve chair and the implications for the bond market, with a focus on long-term reforms needed within the Fed rather than short-term market reactions [1][4][5]. Group 1: Bond Market Reactions - There is skepticism regarding the concerns of bond investors about Hasset's potential appointment, as these worries have not been reflected in market behavior [2][3]. - The yield movements observed are attributed more to external factors, such as Japan's economic situation, rather than the Fed chair appointment [3]. Group 2: Federal Reserve Dynamics - The next chair will face a fractured Federal Reserve that requires time to establish authority and a unified vision for the economy [4][7]. - The importance of long-term reform within the Fed is emphasized, with all candidates on the shortlist acknowledging the need for such changes [4][5]. Group 3: Market Expectations - There is a strong market expectation (91%) for a rate cut in the upcoming Fed meeting, with the belief that the cut will be framed in a hawkish manner due to the confusing economic data [8]. - The Fed's tendency to be excessively data-dependent is noted, which may lead to a more hawkish signal despite the need for a forward-looking approach [9].

Core Viewpoint - Treasury Secretary Scott Besson has raised concerns about the Federal Reserve's mission creep and institutional bloat, advocating for an independent review of the organization [1] Group 1: Federal Reserve's Structure and Employment - The Federal Reserve is currently undergoing a 10% reduction in headcount across the entire organization, including the board and all reserve banks [3] - Following this reduction, employment at the Federal Reserve will revert to levels seen over a decade ago, indicating zero job growth for more than ten years [4] - The Federal Reserve is open to constructive criticism and exploring ways to improve its operations, but it does not support the idea of an independent review [4]

Federal Reserve Board Appointment & Potential Policy Shifts - President Trump nominates Steven Myron to the Federal Reserve Board of Governors until January 31st, 2026 [1][2] - Myron's appointment could lead to lower rates and rate cuts, aligning with Trump's policies [2] - Myron is known for advocating policies that weaken the US dollar, boost US manufacturing, and reduce the trade deficit through tariffs [3] - Myron has proposed reforms at the Fed, including eight-year terms for governors and governors serving at the pleasure of the president [4] - Myron's appointment would potentially give Trump appointees a significant influence on the Fed board [4] Implications & Challenges - The Senate approval before the September 17th FOMC meeting is uncertain, limiting immediate impact [5] - Fed reform proposals, such as congressional approval of the Fed budget and taxing foreign ownership of US bonds, would require congressional approval and are potentially controversial [7][8] - There are concerns about Myron's loyalty to the administration potentially conflicting with the Fed's mandate of low inflation and low unemployment [9] - Even with a majority on the board, the district presidents could offset the president's influence [10]