Kevin Warsh, a Fed governor from 2006–11 long seen as hawkish, has as a Fed
chair nominee signaled support for lower borrowing costs and suggested AI-driven
Productivity gains and balance-sheet runoff could help restrain inflation.
Darius Dale, founder and CEO of 42 Macro, said Warsh's true "reaction function"
is unknown and how receptive FOMC colleagues will be to his views is an open
question; Warsh told senators the Fed had "failed to deliver," has publicly
criticized the institution, and his intellectual ties to Stanley Druckenmiller
and the late Milton Friedman — whose views diverge sharply from current FOMC
members — mean he may raise topics not heard at the Fed for decades, potentially
complicating intra-FOMC coordination.
