Key Highlights:
- Trump considers 11 candidates to replace Jerome Powell.
- Trump’s feud with Powell centers on interest rate policy.
- The new Fed Chair choice will significantly impact U.S. monetary policy.
The Trump administration is weighing 11 potential picks to replace Federal Reserve Chair Jerome Powell when his term ends in May 2026. There has been a reveal of a few contenders which include Jefferies Chief Market Strategist David Zervos, former Fed Governor Larry Lindsey and BlackRock Global Fixed Income CIO Rick Rieder. Other names that are also included in the list are Fed Vice Chairs Philip Jefferson and Michelle Bowman, Dallas Fed President James Bullard, and economic advisers Kevin Hassett and Kevin Warsh. The search indicates that Trump is pushing to appoint a chair that is more in alignment with his economic agenda after months of going back and forth with Powell.
The Trump-Powell Rift: Where it All Began
President Donald Trump has repeatedly clashed with Jerome Powell over his decision to keep interest rates between 4.25% and 4.50% to fight inflation. Powell kept ignoring Trump’s calls for steep cuts. Due to the tension between the two, Trump has labelled Powell as a “numbskull” and “stubborn mule,” and has accused Powell of stalling economic growth and resisting his economic agenda.
This tension goes way beyond rate policies. Trump has even gone to the extent of threatening legal action over Fed spending, a rare challenge to the central bank’s independence. Replacing Powell is not just a routine change but a potential turning point in how the Fed approaches monetary policy.
Newly Disclosed Candidates: Backgrounds and Expertise
Larry Lindsey: The Veteran Economist
Larry Lindsey has served on the Fed Board of Governors from 1991 to 1997 under the leadership of President George H.W. Bush. He is known for spotting the-1990s stock market bubble early and pushing for preventive steps. His career has a blend of government, academia, and advisory roles as he has served as a Special Assistant to the President for Domestic Economic Policy, Senior Staff Economist for Tax Policy and Director of the National Economic Council. He has also taught at Harvard and authored books on economic policy, with expertise in both monetary and fiscal matters.
David Zervos: Market Strategist with a Macro Lens
David Zervos, Chief Market Strategist at Jefferies, is well-known for his sharp analysis of macroeconomic trends and monetary policy. He has his expertise in fixed income and equity markets, guiding institutional investors through Fed moves and economic shifts. His global market insights and rate forecasts could heavily influence Fed strategy if appointed.
Rick Rieder: The Asset Management Powerhouse
Rick Rieder is Global Chief Investment Officer for fixed income at BlackRock, managing trillions in assets. He is a veteran in tackling inflation, rate changes, and market volatility. His approach centers on steering through economic shifts and capitalizing on opportunities created by Fed actions, experience that could shape the central bank’s growth and stability strategy.
How Trump’s Choice Could Shape the Economy and Cryptocurrency Markets
A Fed Chair that will be chosen by Trump will support big rate cuts and will make borrowing cheaper and push the economy. This would fit Trump’s plan but could also increase the risk of higher inflation.
For crypto, this could be a great push as lower rates usually send investors towards higher-yield assets like digital currencies, lifting adoption and investment. The market has generally done well under looser monetary policy, and crypto benefits from the same trend. When fixed-income returns fall, investors often look for higher-yield opportunities, making digital assets like cryptocurrencies more attractive.
Everybody is also well-aware of Trump’s open support for crypto. Keeping this in mind, there are speculations that his pick may push for friendlier regulations. Even though Powell’s Fed took a cautious stance, a Trump ally could clear more paths for institutional adoption and innovation. The flip side? Politicizing the Fed chair role could chip away at central bank independence, shaking markets. Prolonged disputes or legal fights over the replacement could inject more volatility into both traditional finance and the crypto space.
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