Senate Confirms Warsh to Lead Federal Reserve by Vote of 54-45

Added: 2026-05-16

[00:00:00]Looks like we've got the vote over to Mike McKe. He's up there in the Russell Ratunda. Mike, >> well, we have a new Fed chair. At least we will have as soon as he's sworn in.

[00:00:09]Kevin Worsh now has 51 votes for confirmation. The votes still open. It's 5140. So, there are some Democrats and some Republicans who haven't voted. We know that John Federman, the Democrat from Pennsylvania, did vote in favor of Kevin Walsh. So, it doesn't really matter how many he ends up with. He has 51. That's what he needed. So the question now guys becomes when can they get the paperwork done and get him sworn in. Jay Powell is going to be the Fed chair until Friday midnight and after that anytime we could see uh Kevin Worsh put his hand on the Bible and take the oath >> and then Saturday morning he gets the the new office Mike. Is that how it works? Uh I'm not sure if it works exactly like the British prime minister switch out where uh you get up and you just walk out the door and and the other people move in that day. But uh I'm sure that the desks will be rearranged and the furniture will be rearranged in very short order.

[00:01:04]>> Well, speaking of furniture, does he then become in charge of the renovation and all that stuff that's happening on there?

[00:01:12]>> Well, technically he would be in charge of the renovation. Yes. Although I think what uh I what you're getting at of course is what happens with the Justice Department and they would blame POW for anything that had happened before because they'll say Wars comes into the middle of this. So we still don't know what's going to happen with that. The Inspector General has been working on a report on it since last July. So the belief is it won't take that much longer. And if the inspector general finds nothing wrong, then the question is, will the Justice Department say it is closing the investigation with prejudice, which is the legal term for not bringing anything back, or will they say we're going to look at it and see what we're going to do? Because if they're going to do that, then J. Pal is going to stay on.

[00:01:56]>> So, what role will Jay Powell take? I know he was asked a lot about this at the last Fed meeting, Mike, but what have you been able to gather?

[00:02:04]>> I think he'll be the quiet guy over in the corner. He doesn't want to uh sort of interfere with Kevin Worsh taking over. He doesn't want to steal the spotlight. Any kind of speech or public appearance he would make would be scrutinized and he would be held up against what Worsh is saying and it would be sort of like a shadow chair and he doesn't want to do that. So, I suspect he'll come to the meetings and he will offer his opinions and talk to the other governors behind the scenes, but we won't hear much from him going forward.

[00:02:32]>> So, Mike, do we know who in terms of the final vote? Do we have any idea who was the deciding vote here?

[00:02:40]>> Uh, we don't. Uh, I am not on the Senate floor, so I couldn't see who actually cast that vote, but uh, we can try to find out for you. I It's probably a Republican. Generally, that's the way it works. If the party in power is putting something through, uh, the person from that party will vote last. Uh, you remember way back with Obamacare when John McCain came in last, vote no, and it failed in a very dramatic moment.

[00:03:05]This wasn't nearly the drama.

[00:03:07]>> Yeah, the thumbs down. I think that was seen around the country at that time a few years ago. So, Mike, just take us through the process one more time once the Senate, you know, when the formalities here and the actual swearing in. What What's the timing of that?

[00:03:23]>> Well, we finish the vote and then the Senate records it and sends the paperwork down to the White House. As I mentioned, the president's in China, so he's not going to get it directly today or tomorrow. They could send it to him if it's something he needs to do immediately, but if it's not, then they could wait till he gets back. Uh, and then Kevin Walsh has to start divesting his large portfolio. He made an agreement with the Office of Government Ethics on how he's going to do that. You can't sell it all at once. And some people take quite a while. Some of the richer people who come into administrations can take uh Scott Besson took a year to get rid of some of his.

[00:04:00]So, uh, once that's underway, I think the Office of Government Ethics would say that's fine. And then they can swear him in. Uh, and so could be Friday, could be Monday, or could slide into next week a little bit, but it's going to be any day now. Uh, it doesn't really matter till Saturday morning.

[00:04:18]>> Hey, Mike. So once we get through all kind of the logistical stuff, um I mean the vote was the big deal and so on and so forth, but I think about um you were so kind enough to remind us how many meetings Kevin Worsh will preside over and you're talking about five meetings this year. Is the next big kind of interesting moment for him on June 17th when he does reside over that meeting and how he conducts himself, what he says at the press conference.

[00:04:44]>> Well, yes, that's going to be exactly what people are looking at. Nobody's going to expect a rate cut or anything like that. But there are several questions. One is whether he'll even have a news conference. He's tended to say that Fed officials talk too much and he isn't sure whether it's a good idea to have a press conference every meeting. He might do it this time certainly because it's his first one.

[00:05:03]There's also a question about whether they change the language in the statement. We had the three descents about the bias sentence. Uh Wars has said he doesn't like forward guidance.

[00:05:12]So my bet is that comes out. So that will be something to look at. he may change the structure of the statement which really hasn't changed in years and years. So there are going to be things to look at. Also June is the next summary of economic projections and dot plots uh which Kevin War says he doesn't like. It might be too early to be able to change that but uh we might get some comment from him or uh some talk in the minutes of the meeting that they considered uh what the possibility of doing that is. So there's a lot on the plate. There just isn't going to be a lot of drama, I don't think, at this meeting except about Kevin Worsh himself.

[00:05:49]>> Well, on that, Mike, how how does he build consensus at the Federal Reserve?

[00:05:53]How does he bring people together to support his view?

[00:05:57]>> Well, basically, um, you've heard it from many of the open market committee members. He has to come up with a cogent argument that can win their vote. And right now, there is no argument for cutting interest rates. He has said that you can cut rates because productivity from AI is going to be high and that will bring down inflation, but that's not happening right now. So, the only argument that he's advanced publicly for doing that isn't relevant. So, he's going to have to work for a while uh to get the other people on board with the idea of cutting rates. Now a lot of the open market committee members have said if inflation starts to come back down then uh we can cut rates and and mechanically if inflation comes down real rates rise which is an uh a break on the economy. So they don't want that to happen. So you could see if if we get a drop in inflation a movement towards more rate cuts but it's going to be a while. Uh most economists think we won't really see things roll over if the war ended today roll over until maybe September. So, there's going to be at least two meetings where they're on hold, and we'll see where we go beyond