President Donald Trump is considering removing Federal Reserve Chair Jerome Powell before his term ends in May 2026. Trump has discussed this with his advisors, and former Fed Governor Kevin Warsh has emerged as a top choice to replace Powell.
Discussions at Mar-a-Lago
Trump raised the idea of firing Powell during private meetings at Mar-a-Lago, including in February and March. Although he hasn’t made a final decision, he often complains about Powell’s leadership. According to The Wall Street Journal, these talks have triggered legal questions about whether a president can remove a Fed chair before their term ends.
Trump Increases Public Criticism
Recently, Trump stepped up his attacks on Powell. On Truth Social, he posted, “Powell’s termination cannot come fast enough!” He also wrote, “He’s always TOO LATE AND WRONG.” Speaking from the Oval Office, Trump added, “If I want him out, he’ll be out of there real fast, believe me.”
The Federal Reserve Act of 1913 allows the president to remove a Fed official only “for cause.” Powell has said that he can’t be legally removed without proper justification. Most legal experts agree with him. Still, Trump’s team believes the case could end up in the Supreme Court if Trump moves forward.
Kevin Warsh Emerges as Favorite
Kevin Warsh has become a leading contender to replace Powell. He met Trump to talk about the Fed’s direction. Warsh reportedly advised against firing Powell early. Still, Trump values Warsh’s experience and policy views.
Warsh served on the Fed Board from 2006 to 2011 after President George W. Bush appointed him. During the 2008 financial crisis, he worked with international finance leaders and represented the Fed at the G20. He also managed relations with China and other Asian economies.
Before joining the Fed, Warsh worked in mergers and acquisitions at Morgan Stanley. He also served as a senior economic adviser in the Bush White House.
Academic Roles and Global Influence
Today, Warsh is a fellow at Stanford University’s Hoover Institution and teaches at Stanford’s business school. He also advises the Congressional Budget Office and sits on the Group of Thirty, an international economic panel.
Warsh Often Criticizes the Fed
Warsh favors conservative monetary policy. He has regularly criticized how the Fed handled inflation and spending. In a 2022 Wall Street Journal op-ed, he blamed inflation on “a government that spent too much and a central bank that printed too much.”
He also urged the Fed to create a digital dollar. He warned that China was moving faster in that area. Warsh has stressed that the Fed must stay independent from political influence. At one point, he suggested the Fed might have reacted to Trump’s politics when it adjusted interest rates, saying such interference shouldn’t happen.
In a March interview with Fox Business, Warsh backed Trump’s economic strategy. He said, “Inflation is a choice, and the Fed has made a lot of bad choices over these last several years.” He added, “The president has to take matters into his own hands and try to kill inflation by reducing government spending.”
Strong Ties to Trump’s Team
Warsh has close ties to Trump’s inner circle. Trump considered appointing him as Fed Chair in 2017 but chose Powell instead. Warsh helped with Trump’s first transition planning and was even considered for Treasury Secretary. That role eventually went to Scott Bessent, who now oversees the Fed selection process. Bessent recently said that Trump’s team will likely start reviewing Powell’s replacement this fall. He called monetary policy “a jewel box that’s got to be preserved.”
Wealthy Family Connections
Warsh is married to Jane Lauder, the granddaughter of cosmetics mogul Estée Lauder. Jane leads the Clinique brand and holds a senior role at Estée Lauder Companies. Her father, Ronald Lauder, is a major Republican donor. He has also influenced some of Trump’s foreign policy ideas, including the proposal to buy Greenland.
Warsh’s Background and Early Career
Kevin Warsh was born in Albany, New York, on April 13, 1970. He grew up in Loudonville as the youngest of three siblings. He earned a degree in public policy, economics, and political science from Stanford in 1992. He received his law degree from Harvard in 1995.
He also studied finance and economics at Harvard Business School and MIT. In 2009, Fortune magazine listed him in its “40 Under 40” for his early achievements.
Tech and Crypto Investments
Warsh has invested in fintech and crypto firms. He backed the now-defunct platform Basis and has invested in Bitwise, which offers crypto index funds, according to PitchBook.
With deep experience in finance, crisis leadership, and government, Warsh stands as a strong candidate to lead the Fed if Trump chooses to make a change in monetary policy leadership.
