Kevin Warsh Pitches a More Insular Fed

“The Trump administration’s coming to the Fed.” That was economist Claudia Sahm’s takeaway after watching Kevin Warsh’s confirmation hearings on Tuesday to become the next chair of the Federal Reserve. Sahm, who worked at the central bank for more than a decade, is chief economist at New Century Advisors and watched the congressional grilling from her desk. Although most of her colleagues were not watching, they got a taste of the hearings from Sahm, despite the fact that she was wearing headphones. “They were kind of laughing because every once in a while I would just blurt something out,” she says. “At one point, a notepad may have gone flying across the room.”

For two hours, Warsh, President Donald Trump’s nominee to replace Jerome Powell, whose term as Fed chair is up in May, fielded questions ranging from whether he was a “human sock puppet” for the president (“absolutely not”) to whether the 2020 election was stolen (“We try to keep politics … out of the Federal Reserve”). But Sahm’s frustrations had less to do with politics and more to do with policy. Warsh’s answers were largely vague and noncommittal. “I’m an economist, I’m looking for substance,” she says. “He has been in central banking spaces for over 20 years, he should not be such an enigma.”