Karla Barker 
The Long Road to the Fed Chairmanship
Kevin Warsh always believed the Federal Reserve job was his. Back in November 2024, right after Donald Trump won the election, Warsh flew to Mar-a-Lago thinking he was being interviewed for Treasury Secretary. But Trump had other plans. “You’re my Fed chair,” Trump told him directly.
For over a year, Warsh repeated that conversation to everyone who would listen. And he turned out to be right, though it took much longer than expected. Fourteen months passed, with one bitter fight inside the White House and a criminal case against Jerome Powell complicating matters. By January 2026, Trump finally made it official. He picked Warsh to lead the Federal Reserve.
The Hassett Obstacle
The biggest obstacle in Warsh’s path was Kevin Hassett, Trump’s economic adviser. By late 2025, Hassett was convinced he had secured the position. Trump told his cabinet he’d made his pick, and all other interviews were suddenly canceled. While Warsh was on vacation in the Bahamas, Trump spent the holidays with Hassett in Florida. At that point, most observers assumed Hassett had won the job.
Trump even hinted to reporters, “I know who I’m going to pick,” then just grinned without revealing the name. Inside the West Wing, officials started ignoring Warsh. One senior official said he was finished and mocked him like a man clinging to a sinking boat. The reason? Trump thought Warsh looked desperate for the position.
Wall Street’s Influence
But Warsh had something Hassett didn’t—powerful friends in the financial world. JPMorgan CEO Jamie Dimon said he liked Warsh for the job. Stanley Druckenmiller made calls on his behalf. Treasury Secretary Scott Bessent was also close with Druckenmiller. Ronald Lauder, Warsh’s father-in-law, is a Republican megadonor with close ties to Trump.
That influential group didn’t remain quiet. They got on the phone and told Trump’s team that Hassett was too close to Trump to be seen as independent by financial markets. This was a risky move. Dimon had previous conflicts with Trump, and Druckenmiller said he wouldn’t vote for either Trump or Kamala Harris in 2024. Still, their pitch landed effectively.
Hassett’s Wall Street credibility came under scrutiny. He also mentioned he might not stay the full four-year term, which made people wonder how badly he actually wanted the position. Hassett told reporters, “This is my dream job,” but the doubts had already been planted.
The Final Decision
On December 10, just hours after the Fed cut rates by 0.25%, Warsh met with Trump. Trump had long regretted choosing Powell and was looking for someone who would work with him rather than push back. He asked Warsh directly if he would support more rate cuts. Warsh said yes.
Trump later told the Wall Street Journal, “I asked him what he thinks. He thinks you have to lower interest rates.” During the holidays, Trump told aides he liked Warsh’s sharpness and appearance. This was a change from 2017, when he’d passed on Warsh for looking too young and chose Powell instead.
Then came the turning point. On January 11, Powell announced the Department of Justice was investigating him for allegedly lying to Congress. This created chaos, with Republicans like Senator Thom Tillis and Lisa Murkowski saying they’d block any nominee until the case was resolved. The scandal effectively ended Hassett’s chances, as he had spent months criticizing Powell on television.
On January 16, Trump publicly humiliated Hassett at a White House event, saying, “I actually want to keep you where you are,” with Hassett sitting in the front row. Warsh, meanwhile, had stayed relatively quiet, giving a few speeches the previous year before disappearing from public view.
Other Candidates Fade Away
Other finalists never really had a chance. Fed Governor Christopher Waller’s meeting with Trump lasted only 30 minutes, and Trump was two and a half hours late. Rick Rieder’s meeting was longer, but he pitched a complex rate structure that didn’t resonate. He had also donated to Democrats and Nikki Haley, which didn’t help his case.
Treasury Secretary Scott Bessent started the search process last summer, interviewing 11 people. He didn’t want to be blamed for the choice like Steven Mnuchin was back in 2017 when Powell was selected. Bessent told friends Trump was making the call himself.
The delay made some officials think the search might expand. On the Monday before the announcement, Judy Shelton, known for backing Trump’s Fed views, met with Bessent, adding to speculation. But the Fed held rates steady that Wednesday, and Powell hinted they might not cut rates again soon.
That night, Trump met with Warsh one more time. The next morning at 6:48 a.m., he made it official. “I have known Kevin for a long period of time,” Trump wrote online, “and have no doubt that he will go down as one of the GREAT Fed Chairmen.”
It’s interesting to see how these political appointments unfold. The process reveals much about power dynamics, personal relationships, and how financial markets influence government decisions. Warsh’s appointment represents a significant shift in Fed leadership, and markets will be watching closely to see how his policies differ from Powell’s approach.