Trump Nominates Kevin Warsh for Fed Chairman, but Early Hints Led to Suspicious Spike in Betting Odds for the Former Central Bank Governor

President Trump announced Kevin Warsh as his pick for Federal Reserve chairman early Friday morning following his attacks on the current chairman, Jerome Powell, which now includes a criminal investigation. After saying Thursday night that he had decided on his nominee, a suspicious spike in betting odds for the former Central Bank Governor took place. Mr. Trump first nominated Mr. Powell for the role in 2017, and began criticizing him shortly thereafter for his monetary policy decisions. Since returning to the White House last year, Mr. Trump has been more strident in his criticism of the central bank leader, saying Mr. Powell has been “too late” to cut interest rates despite concerns about inflation. On Thursday, while attending a showing of the new documentary detailing first lady Melania Trump’s role in the 20 days leading up to the 2025 inauguration, Mr. Trump said he had chosen his nominee to lead the Fed. “I’ll be naming the Fed [nominee] tomorrow morning. I’ve chosen a very good person to head the Fed. I’ll be putting that out tomorrow morning,” Mr. Trump told reporters at the John F. Kennedy Center for the Performing Arts before a screening of the film. He says he is planning to nominate an “outstanding person.”On what made him choose his nominee from the shortlist that he and his team had compiled, the president heavily implied that his pick would be Mr. Warsh, who was nominated to that post by President George W. Bush in 2006. Mr. Warsh, a Harvard Law School graduate, left the board of governors in 2011. If nominated and confirmed, he would be the second lawyer — after Mr. Powell — to lead the Fed. Mr. Trump said his nominee “won’t be too surprising to people,” and is someone that “could have been [the nominee for chairman] a few years ago.” Mr. Warsh was a finalist to be Mr. Trump’s nominee for Fed chairman in 2017 before he eventually chose to nominate Mr. Powell. Just minutes after Mr. Trump said that he had chosen his nominee to lead the central bank, a suspicious spike in betting odds for Mr. Warsh took place. On the betting site Kalshi, Mr. Warsh’s odds to be the Fed chairman nominee spiked to about 91 percent from only 38 percent on Thursday night. In the week leading up to Mr. Trump’s Thursday disclosure that he had chosen his nominee, a top executive at the investment firm BlackRock, Rick Rieder, had been the leader in the Kalshi betting odds, taking about 40 percent. By late Thursday, Mr. Rieder’s odds on Kalshi had fallen to only six percent as Mr. Warsh surged. Another betting platform, Polymarket, had Messrs. Warsh and Rieder tied, with each taking about one-third of bettors’ odds. Shortly after Mr. Trump said Thursday that he had settled on a nominee, Mr. Warsh shot up to 92 percent, with Mr. Rieder taking just about five percent. According to the Wall Street Journal, Mr. Warsh met with Mr. Trump at the White House on Thursday. Mr. Rieder is currently in Singapore, leading to speculation that he would not be the nominee. Mr. Warsh faces some significant challenges in the Senate, where lawmakers will be able to contemplate the nomination for weeks. Mr. Powell’s term does not end until May. Senator Thom Tillis, a Republican from North Carolina who is retiring this year, has already promised to put up a one-man blockade of any Fed nominee after Mr. Powell announced that he was under criminal investigation. As a member of the Banking Committee, Mr. Tillis has the power to kill any Fed nomination, given the committee is split with 13 GOP members and 11 Democratic members. A tie vote results in a failed report to the floor, meaning any nomination would be trapped in the panel’s consideration. “If there were any remaining doubt whether advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should now be none. It is now the independence and credibility of the Department of Justice that are in question,” Mr. Tillis said earlier this month after Mr. Powell said he was under investigation. Senator Lisa Murkowski said in a statement that she agrees with Mr. Tillis on that fact. Republicans can afford to lose only three members on a confirmation vote for Fed chairman.

Trump Nominates Kevin Warsh for Fed Chairman, but Early Hints Led to Suspicious Spike in Betting Odds for the Former Central Bank Governor

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