Wall Street picked Trump's new Fed chairman Kevin Warsh

Kevin Warsh always said the job was his. Back in November 2024, right after Donald Trump won the election, Kevin 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.

For over a year, Kevin repeated that to everyone. And he was right. It took 14 months, one bitter fight inside the White House, and a criminal case against Jerome Powell, but by January 2026, Trump finally said it out loud. He picked Kevin to lead the Federal Reserve.

How Kevin outplayed Hassett with Wall Street help

The biggest obstacle in Kevin’s way was Kevin Hassett, Trump’s economic adviser. By late 2025, Hassett was convinced he had the job. Trump told his cabinet he’d made his pick.

All other interviews were suddenly canceled. While Kevin was on vacation in the Bahamas, Trump was spending the holidays with Hassett in Florida. At that point, everyone assumed it was Hassett.

Trump even hinted to reporters, “I know who I’m going to pick,” then just grinned.

Inside the West Wing, officials started ignoring Kevin. One senior official said he was finished and mocked him like a man clinging to a sinking boat. The reason? Trump thought Kevin looked desperate.

But Kevin had something Hassett didn’t; powerful friends. JPMorgan CEO Jamie Dimon said he liked Kevin for the job. Stanley Druckenmiller made calls on his behalf. Treasury Secretary Scott Bessent was tight with Druckenmiller too.

Ronald Lauder, Kevin’s father-in-law, is a Republican megadonor and close to Trump. That crew didn’t sit quiet. They got on the phone and told Trump’s team: Hassett was too close to Trump to be seen as independent by the markets.

It was risky. Dimon had beef with Trump. Druckenmiller said he wouldn’t vote for either Trump or Kamala Harris in 2024. Still, their pitch landed. Hassett’s Wall Street credibility came under fire. He also said he might not even stay the full four years. People started wondering how badly he even wanted the job.

Hassett said he was happy where he was. “This is my dream job,” he told reporters.

Trump wanted a rate cutter, and Kevin said yes

On December 10, just hours after the Fed cut rates by 0.25%, Kevin met with Trump. Trump had long regretted choosing Powell. He was looking for someone who’d work with him, not push back.

He asked Kevin straight up if he would support more cuts. Kevin said yes.

Trump told the Journal, “I asked him what he thinks. He thinks you have to lower interest rates.”

During the holidays, Trump told aides he liked Kevin’s sharpness and how he looked. It was a change from 2017, when he’d passed on Kevin for looking too young and chose Powell instead. Back then, Powell was seen as more open to easy-money policies. Kevin was the hawk. He later told NYU professor Simon Bowmaker, “I did not put my ambitions ahead of my principles.”

After the first term soured, Trump’s team asked Kevin if he’d replace Powell. He refused.

“The position was not open,” he told Bowmaker. But in Trump’s second term, talks restarted. Trump even considered firing Powell. Again, Kevin said not yet.

Then on January 11, Powell went public. He announced the DOJ was investigating him for lying to Congress. That set off chaos. Republicans like Senator Thom Tillis and Lisa Murkowski said they’d block any nominee until the case was over. The scandal crushed Hassett’s chances. He had spent months on TV trashing Powell. Now his loyalty looked dangerous.

On January 16, Trump humiliated him in public. At a White House event, Trump said, “I actually want to keep you where you are,” with Hassett sitting in the front row.

Kevin, on the other hand, had stayed quiet. He gave a few speeches last year, then disappeared from TV.

Other finalists? They never had a shot. Fed Governor Christopher Waller’s meeting with Trump lasted 30 minutes. Trump was two and a half hours late. Rick Rieder’s meeting was longer, but he pitched a complex rate idea; 3% fed-funds, 4% on the 10-year Treasury, 5% mortgages. He’d also donated to Democrats and Nikki Haley. That didn’t help.

Scott started the process last summer. He interviewed 11 people. He didn’t want to be blamed for the choice like Steven Mnuchin was back in 2017 when Powell was picked. He told friends Trump was making the call himself.

The delay made some officials think the search might expand. On Monday before the announcement, Judy Shelton (known for backing Trump’s Fed views) met Scott. That added speculation.

But the Fed held rates steady Wednesday, and Powell hinted they may not cut again soon. That night, Trump met Kevin 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.”

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