## Trump’s Fed Choice: Intrigue and Potential for Political Turmoil
The recent resignation of Federal Reserve Governor Adriana Kugler has opened a door for potential political maneuvering at the Federal Reserve. With a vacant seat on the board, former President Donald Trump has a few strategic options, each with its own set of implications for the central bank’s future.
- **The “Shadow Chair” Option:** Trump could appoint a temporary “shadow chair” to the board. This person’s primary role would be to challenge current Chair Jerome Powell, a frequent target of Trump’s criticism. This strategy would align with Trump’s preference for conflict and competitive environments.
- **The “Long-Term Strategy” Option:** Alternatively, Trump could appoint someone he intends to be the next Fed chair, effectively setting the stage for a future leadership change.
- **The Short-Term Risks:** The short timeframe of the appointment, with Kugler’s term expiring soon, adds risk. Any appointee could face pressure from Trump to align with his views on interest rates, potentially jeopardizing the Fed’s independence.
- **The Candidates:** Potential candidates include former Governor Kevin Warsh, National Economic Council director Kevin Hassett, and current Governor Christopher Waller.
- **The Stakes:** Trump’s actions could significantly impact the Fed’s independence and its ability to conduct monetary policy free from political influence.
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