02/01/2026
President Donald Trump has nominated Kevin Warsh to lead the Federal Reserve, aiming for lower interest rates to ease the housing crisis. Warsh, a former Fed governor, calls for a “regime change” in Fed policy, criticizing current approaches and forward guidance.
His plan focuses on shrinking the Fed’s $6.6 trillion balance sheet and selling $2 trillion in mortgage-backed securities (MBS), which he says could create space for lower rates without fueling runaway inflation. It’s an unorthodox approach, and it’s unclear if he can win support from other Fed members.