## Trump’s Fed Choice: Intrigue and Potential Turmoil
The unexpected resignation of Federal Reserve Governor Adriana Kugler has opened the door for potential political maneuvering at the central bank. With a vacant seat on the board, former President Donald Trump has a few strategic options, each with its own set of risks and rewards.
- **The Shadow Chair Option:** Trump could appoint a “shadow chair” to fill the remaining months of Kugler’s term. This individual would essentially serve as an instigator, potentially creating conflict with current Chair Jerome Powell. This strategy aligns with Trump’s preference for conflict and competition.
- **The Long-Term Strategy:** Alternatively, Trump could appoint the person he wants to eventually replace Powell as chair. This would be a more conventional approach, avoiding potential adversarial relationships within the Fed.
- **The Candidates:** Potential candidates for the open seat include former Governor Kevin Warsh, National Economic Council director Kevin Hassett, and current Governor Christopher Waller, among others.
- **Rate Cut Pressure:** Trump has publicly demanded significant rate cuts, which has drawn criticism for potentially undermining the Fed’s independence.
- **The Risks:** Appointing a shadow chair carries risks, as the individual could face pressure from Trump and potentially damage their relationships within the Fed. The short time frame also increases the likelihood of conflict.
- **The Stakes:** The choice will significantly impact the Fed’s future direction and could introduce a new era of political intrigue within the historically collegial institution.
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