TIME TO EXPLAIN HOW YOU ARE THINKING ABOUT AN INCOMING CHAIR WARSH AND WHAT MIGHT CHANGE AT THE INSTITUTION YOU WORKED OUT FOR SO LONG. RICHARD: THANK YOU FOR THAT. KEVIN WARSH I HAVE KNOWN FOR A DOZEN YEARS.HE IS ACCOMPLISHED, RESPECTED. HE HAS A PAPER TRAIL AND HAS BEEN QUITE SPECIFIC IN HIS ASSESSMENT AND IN MANY CASES CRITICISM OF FED PRACTICE. THE BALANCE SHEET HE THINGS IS TOO BIG.THE FED HAS GOTTEN INTO CREDIT ALLOCATION AND MORTGAGES. HE HAS BEEN CRITICAL OF FORWARD GUIDANCE INFORMATION THE FED PROV ...

Bitcoin collapsed below the psychological $70,000 support level Thursday, marking a 15-month low as markets aggressively repriced the liquidity outlook under incoming Federal Reserve Chair Kevin Warsh. The world’s largest cryptocurrency fell as low as $67,619. The rout erased $40 billion from open interest in under 48 hours, showing a capitulation of leveraged longs. The catalyst? The market’s digestion of President Trump’s nomination of Kevin Warsh. While Warsh is historically pro-crypto, calling Bitco ...

Jerome Powell is out, Kevin Warsh is in. At least, that's the plan. Powell's term ends on May 15, and President Trump's nomination of Warsh is expected to sail through Congress relatively easily. The nomination of Warsh took Wall Street by surprise, given the White House's at-times fierce criticism of Powell for holding rates steady much of last year. Warsh is historically viewed as a hawk who has criticized quantitative easing and the use of lower rates to juice the economy. Goldman Sachs, however, does ...

Core Viewpoint - The Federal Reserve is likely to maintain interest rates unchanged in the foreseeable future, especially with the nomination of Waller as the next Fed Chair, amidst a resilient U.S. economy and rising inflation risks [1][3]. Economic Outlook - The combination of loose financial conditions, relaxed monetary policy, and upcoming large-scale fiscal stimulus (OBBA Act) may lead to a nominal GDP growth of 5-6% in the U.S. this year [1]. - The Dallas Fed tracks Q4 GDP growth at 2.49%, while the New York Fed's real-time forecast is at 2.74%, achieved even during a prolonged government shutdown [1]. Federal Reserve's Position - The Fed acknowledged stronger economic growth and shifted its risk balance from employment targets, describing economic activity as "robust" rather than "moderate" [3]. - The Fed Chair Powell indicated that the policy rate is no longer in a restrictive zone, with the current rate close to the estimated neutral rate of around 3.25% [3]. Dollar Dynamics - The dollar has depreciated approximately 11% over the past year, but with the Fed likely to remain cautious in the coming months, dollar shorts should be wary at current valuation levels [3][10]. - The weak dollar theme has been driven by various factors, including the U.S. Treasury's engagement with the Japanese Ministry of Finance, which has contributed to the dollar's decline [8]. Future Fed Leadership - Waller's nomination as the next Fed Chair is seen as a response to political dynamics, with him being viewed as a more establishment candidate and potentially facing less resistance during confirmation [6]. - Historically, Waller has been more hawkish than other candidates, prioritizing inflation control over employment considerations, and is expected to implement rate cuts only when absolutely necessary [6][7]. Market Implications - The current economic conditions and the Fed's emphasis on independence suggest that the future of the Fed may be less susceptible to political interference, which is viewed positively by investors who value central bank independence for global financial stability [10].

Economic Overview - U.S. manufacturing activity unexpectedly expanded in January, marking the biggest jump since 2022, which is a positive indicator for the economy [2][20] - The S&P 500 is heading for record highs, currently up by about 0.5% [1][20] - The U.S. dollar continues to rally, with the Bloomberg Dollar Spot Index higher by about 0.3% [2] Federal Reserve Insights - There is speculation about a potential reshaping of the Federal Reserve under Kevin Warsh, who is critical of quantitative easing (QE) and aims to create a separation from the administration [4][7][15] - The Fed's balance sheet has decreased from $9 trillion to approximately $6.6 trillion, raising questions about future monetary policy and the implications for government funding [14][15][18] - The Fed is currently believed to be pausing on balance sheet shrinkage, which may lead to discussions about the appropriate size of the balance sheet during abnormal economic times [16][18] Market Reactions - Traders are adjusting their expectations regarding Federal interest rate cuts, with discussions of a "Goldilocks" scenario of solid growth that contains inflation [3][19] - Concerns about the sustainability of elevated prices in precious metals like gold and silver are emerging, as the dollar strengthens [42][46] - Companies in the AI sector, including Oracle, are facing scrutiny over their debt levels as they raise funds to support growth ambitions [60][66] Corporate Developments - Coeur Mining is actively pursuing acquisitions to create a North American mining powerhouse, focusing on low-risk exposure in Canada, the U.S., and Mexico [56][58] - The company anticipates more consolidation in the mining sector as investors seek sustainable price levels [58] - Disney's recent earnings report reflects a strong performance driven by its parks and cruise business, despite some concerns about future growth [30][33][39]

Digital asset investment products saw a second consecutive week of outflows last week, totaling $1.7 billion and leaving net year-to-date flows at a global outflow of about $1 billion, according to CoinShares. The U.S. accounted for the vast majority of redemptions, with $1.65 billion in outflows. Canada and Sweden also posted withdrawals of $37.3 million and $18.9 million, respectively. Switzerland and Germany registered modest inflows of $11.0 million and $4.3 million. Outflows were broad-based across ...

January 30, 2026 11:19 PM GMT US Rates Strategy | North America A Kevin Warsh-led Federal Reserve and US Treasuries A Kevin Warsh-led Fed should lead to a steeper yield curve over time, assuming communication and balance sheet policy adheres to views he previously expressed. The potential for more monetary policy surprises and less consensus among investors about its future path should raise realized volatility. Key Takeaways Please add me to your distribution list. MORGAN STANLEY & CO. LLC | M US Rates Str ...

Core Viewpoint - Kevin Warsh's appointment as the Federal Reserve Chair could significantly impact interest rates, mortgage costs, and overall market stability, reflecting a shift from his previous hawkish stance to a more dovish approach in recent years [2][4][5]. Group 1: Warsh's Background and Views - Warsh served as a Fed governor from 2006 to 2011, initially supporting aggressive measures post-2008 financial crisis but later adopting a dovish tone aligned with President Trump's preference for lower interest rates [2][3]. - His historical skepticism towards the Fed's quantitative easing (QE) programs indicates a potential preference for a smaller balance sheet and less predictable policy communication, which could affect mortgage rates and market dynamics [5][8][10]. Group 2: Potential Implications of Warsh's Leadership - Warsh's leadership may lead to rate cuts by 2026, but uncertainty remains regarding whether his previous hawkish persona will resurface [3][8]. - His critical stance on the Fed's bond market interventions and the current balance sheet of nearly $6.6 trillion suggests that unwinding these measures could lead to higher mortgage rates, conflicting with Trump's goals [5][9]. - Warsh's approach to forward guidance may shift, potentially reducing the frequency of "insurance cuts" and leading to more significant policy changes during inflection points [12][13]. Group 3: Consensus and Institutional Dynamics - Any decisions made under Warsh's leadership will require consensus from the 19-member Federal Open Market Committee (FOMC), where divisions exist between hawkish and dovish members [14][15]. - Warsh's ability to navigate these institutional dynamics will be crucial, as he has previously voted for policies he disagreed with to maintain consensus [14][15].

Core Viewpoint - The nomination of Kevin Worsh as Fed chair is expected to be transformational, with a focus on stopping the Federal Reserve's mission drift and implementing a price rule to control inflation and interest rates [1][2][3]. Group 1: Federal Reserve's Approach - The traditional method of lowering interest rates through bond purchases is criticized for expanding the Fed's balance sheet and raising inflationary expectations, suggesting that selling bonds would be a more effective strategy [3][4]. - Worsh's understanding of a price rule is highlighted as a correct approach to managing inflation and interest rates [4][8]. - The need for the Federal Reserve to stop monetizing excessive government spending is emphasized, as this has contributed to inflation [9][10]. Group 2: Collaboration Between Treasury and Fed - The importance of collaboration between the Treasury and the Federal Reserve is stressed, with a call for both entities to work together rather than being in conflict [6][10][13]. - The relationship between the Fed and the White House should be friendly and cooperative to benefit the economy, which has been lacking in recent years [13][14]. - The potential for a productive partnership between Worsh, Hasset, and the Treasury is viewed positively, with expectations for improved economic growth [16][17]. Group 3: Economic Predictions and Concerns - Worsh's previous predictions regarding inflation resulting from increased government spending and the Fed's actions are noted, with a historical context of the worst inflation in decades [12][19]. - The discussion includes concerns about the impact of quantitative easing (QE) on government spending and inflation, with a desire to avoid repeating past mistakes [18][19]. - The need for a shift in the Fed's economic models to recognize that growth can occur without inflationary pressures is highlighted, indicating a potential for sustainable productivity increases [21].

It was a crowded week on Wall Street, with a Federal Reserve meeting and a slate of major tech earnings. But the moment that ultimately mattered most came Friday morning, when President Donald Trump nominated Kevin Warsh as the next Chair of the Federal Reserve.Warsh is set to replace Jerome Powell when Powell's term expires in May. A former Federal Reserve governor from 2006 to 2011, Warsh was one of the youngest policymakers in modern Fed history, joining the Board at just 35.Warsh is also well known as a ...