00:00I know this nomination doesn't necessarily go through your committee, but you're certainly
00:03going to have a say over Kevin Warsh's nomination. And I am curious as to what most you want to
00:10actually hear out of Warsh if and when this nomination actually gets to a hearing.
00:16First, I want to make sure that he believes in Fed independence and that the decisions are going
00:20to be made by the Fed and not by the administration. Second, I want to hear his comments about both the
00:27balance sheet and interest rates. But I think he's established himself as a mainstream thinker.
00:33Now, whether he's 25 basis points this way or 25 basis that way, given how terrible some of Donald
00:41Trump's appointments have been, anybody in the range of reason is a step up. This Warsh is not the
00:49JFK Jr. of Federal Reserve decisions. The final concern I have is on crypto, where he has been
01:00very involved in crypto. And the whole purpose of the Fed is to maintain the value and the popularity
01:07of the U.S. dollar. Crypto is trying to compete with that. And I would hope that he would be loyal
01:14to the dollar and would take a clear position that crypto entities are not going to be bailed out by
01:21the Fed. I am curious, though, when you say all of those things, one of the biggest concerns about
01:26this nomination is the idea that the president himself had made it clear the type of Fed chair
01:32that he wanted based on the jawboning of Jay Powell. No matter what Kevin Warsh says,
01:37are you going to believe him?
01:41I believe he that he is a mainstream economy, you know, someone with mainstream economic views.
01:48And he has established that. I then he then has to convince me that he is tough enough to withstand
01:57the pressure the way Jay Powell has, even under this criminal investigation. Then even if he's good,
02:04I understand Senator Tillis and others who say stop this appointment until this investigation
02:11is completed. And the effort of this investigation, because this is a phony investigation,
02:16to intimidate the Fed is brought to an end. And then I've got my concerns about about crypto.
02:22On the other hand, Warsh has said that he's for a digital dollar. And that is competition
02:31that crypto deserves to have. If you're going to have electronic transactions in crypto, there's no
02:39reason to tie the Fed's hand and not have electronic transactions right out of the Federal Reserve.
02:45Well, I actually want to go back to what you were saying about Senator Tillis. Of course,
02:49he was on Bloomberg television earlier this morning. And actually, when it comes to Warsh,
02:54he's actually likes Warsh as a pick as the nominee for Federal Reserve chair. Nevertheless, he did say
03:01that he would continue to block any nominee until that pressure on Fed chair Jerome Powell and Lisa
03:07Cook is alleviated. But do you see any realistic chance that President Trump actually backs off
03:14from that investigation? He backed off on invading Greenland. He's backed off on a lot of things.
03:19A taco stands for Trump always chickens out. And so I wouldn't be surprised if and they don't you
03:29know, they don't they only need to do this by May. I wouldn't be surprised if they figured out a way
03:34to wrap this up. You know, there are federal building projects that go over budget. That's not
03:40a reason for a criminal investigation. All right, we'll see. It is a good point. And there is a long
03:44time until May here. I am curious. I mean, how are you thinking about the state of the economy
03:50right now? President Trump, the administration clearly has voiced a preference for lower interest
03:57rates. It seems that Fed chair nominee Kevin Warsh agrees with that. But how are you feeling about
04:03inflation and where basically the right level of monetary policy is to meet that? Well, some of God's
04:10greatest gifts are unanswered prayers. If Trump had been successful in lowering interest rates below
04:18where economists thought they should be six months ago, we would have high inflation now. And from a
04:25political standpoint, what's at greatest issue is prices. I suspect that if there are politicians
04:33around the president, there certainly are, that they will try to push the Fed to cut interest rates
04:40to as low a level as possible this summer on the theory that people enjoy getting the low interest
04:45rates and the inflation doesn't happen till after the November election. So I think we need an
04:52independent Fed. I think that Warsh has certainly got, is within the range of reason as to the decisions he will
04:59personally reach. And the real question is, does he have the backbone and does the rest of the Fed have the
05:04backbone to stand up to Donald Trump and his whole team? Clearly, having an independent central bank
05:14is critical for the United States. We saw how Turkey's economy was severely damaged by Erdogan,
05:20President Erdogan's interference in their central bank. And the world depends much more on the dollar
05:25than on the Turkish currency.
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