Trump chooses Kevin Warsh to head the Federal Reserve Board.. who is he and why was he chosen?
President Donald Trump announced, in a post on the (Truth) platform, the selection of Kevin Warsh to be the Chairman of the Board of Governors of the Federal Reserve System.
Who is Kevin Warsh?
He is a former American banker, lawyer, and economic official, known for his deep expertise in financial and economic markets, with a long history of work in government and the private sector.
Highlights of his career:
* At the Federal Reserve (2006-2011): Served as a member of the Board of Governors of the Federal Reserve, and was then the youngest member in the board's history (35 years old). He played a pivotal role during the global financial crisis of 2008, being the main link between the Fed and Wall Street due to his banking background.
* At the White House: Previously served as a special advisor to President George W. Bush on economic policy and as the director of the National Economic Council (2002-2006).
* In the private and academic sector: Started his career at "Morgan Stanley" in the mergers and acquisitions department. Currently, he works as a visiting fellow at the "Hoover" Institution at Stanford University and serves on the boards of major companies like UPS.
His economic and political directions:
Warsh's selection is interesting because it combines traditional expertise with the economic and financial trends that Trump prefers:
1. Monetary policy: Historically known as one of the "hawks" who tend to be tough on inflation, but recently he criticized the Fed's delay in lowering interest rates, making him align more with Trump's desire for an accommodative monetary policy (lower interest rates).
2. Cryptocurrencies: Viewed positively by the crypto community. Unlike Jerome Powell, who was skeptical, Warsh previously stated that Bitcoin could be a "store of value" similar to gold, and he does not feel concerned about it.
3. Independence of the Fed: He is expected to be more flexible in dealing with the Trump administration compared to Powell, although markets hope he maintains the institution's independence thanks to his previous experience.
Why did Trump choose him?
Trump is looking for a credible figure in the markets (to reassure investors) and at the same time someone who is more responsive to his economic and financial policies that support growth and lower interest rates. Warsh has the institutional "credentials" (previously worked at the Fed) and strong relationships with Wall Street, in addition to his loyalty to Republican economic views.
Kevin Warsh is a "hybrid" choice that satisfies the markets with his experience and satisfies Trump with his flexibility and openness to economic renewal and support for new assets.
