Powell said in January that “the threat of criminal charges” against him was directly tied to his refusal, and that of other governors, to bow to Trump’s demands for faster rate cuts.
Senator Thom Tillis of North Carolina, a Republican on the Senate Banking Committee, said Warsh was “a qualified nominee with a deep understanding of monetary policy” but vowed to block any Fed nominee “until the investigation and potential indictment of Chair Powell is completed.”
The Powell probe followed Trump’s attempt last summer to fire Fed governor Lisa Cook after a housing official he appointed accused her of mortgage fraud, an allegation Cook denied. She remained on the board pending the outcome of a lawsuit challenging her removal, which the Supreme Court heard in January.
Senator Elizabeth Warren responded to Warsh’s nomination by writing that he “cared more about helping Wall Street after the 2008 crash than millions of unemployed Americans” and that no Republican “purporting to care about Fed independence” should advance the nomination while Trump pursued “witch hunts” against Powell and Cook.
Will mortgage rates drop?
“I don’t want to say it’s a total surprise… he was considered a hawk, but recently he seems to have aligned himself with Trump,” Peter Cardillo, chief market economist at Spartan Capital Securities, told Mortgage Professional America, adding that it was “difficult to assess how the market is going to accept this nomination.”
