Main PageJuly 17, 2025

Kevin Warsh: AI trends is a opportunity and is concerned the Fed cannot see that

  • Sees AI trends which could reduce costs in long-run and provide a golden opportunity. Concerned the Fed cannot see that
  • Last thing they need is continuity.
  • Central bank that sits there today is radically different from the one he saw in 2006.
  • Don’t think need continuity one the central bank does not have credibility.
  • Says need regime change at the Fed.
  • Cuts last time round inflation was 50% higher.
  • The broad conduct of monetary policy has been broken for a long time
  • dominant model that the Fed appear to be out of date
  • Fed independence is essential.
  • Says that the Fed hasn’t always been independent, citing DEI, and climate change.
  • Fed has done a very good job of blaming others for their mistakes.
  • Fed has made poor choices regarding inflation.
  • The reason the Fed has not made the right decisions of rate is due to present and tariffs.
  • The first rate cut would be a first step toward regime change
  • We are near a housing recession.
  • We can take a little out of the fiscal business and redeploy to some in the real economy.
  • Fed should be at of the fiscal and political business.
  • Fed is in such hot water because it has 100 outside its remit. Fed is powerful but narrows the Constitution
  • The group at the Fed does not have a deep understanding of what is going on.
  • Fed hasn’t had interest rate rate for a long time
  • We are a transformational moment

About Warsh:

Federal Reserve Board Member (2006–2011)

  • Appointed by President George W. Bush.

  • Served during the 2008 global financial crisis.

  • Acted as the Fed’s primary liaison to Wall Street.

  • Instrumental in early emergency programs and the initial phase of quantitative easing.

White House Economic Experience

  • Special Assistant to the President for Economic Policy (Bush administration).

  • Advised on domestic finance, banking, and securities regulation.

Private Sector Background

  • Former executive at Morgan Stanley, focused on mergers and acquisitions.

  • Post-Fed career includes roles in finance, advisory, and think tanks.

Academic & Institutional Ties

  • JD from Harvard Law School; BA from Stanford University.

  • Distinguished visiting fellow at the Hoover Institution, Stanford University.

  • Frequently contributes to policy debates on monetary strategy, inflation, and Fed governance.

This article was written by Greg Michalowski at www.forexlive.com.