The administration of US President Donald Trump has launched a significant investigation into the country's central bank, the Federal Reserve. The Department of Justice has issued grand jury subpoenas in a move that could lead to criminal charges. This dramatic development comes just months before the scheduled retirement of current Fed Chair Jerome Powell in May, whom Trump has previously threatened to fire before his term concludes.
The Frontrunner for the Top Fed Job
Over recent months, the Trump administration has circulated several names as potential successors to lead the world's most influential central bank. Among the top contenders, Kevin Hassett, the current Director of the National Economic Council, has been repeatedly mentioned. He is now positioned as a likely candidate to succeed Powell in May, a move that would have profound implications for global financial markets.
So, who is Kevin Hassett? An economist by training, Hassett holds a PhD from the University of Pennsylvania and has taught at prestigious institutions like the American Enterprise Institute. He is a long-time Trump aide, having served as the chair of the Council of Economic Advisers from 2017 to 2019. His known policy stances include:
- Support for pro-growth tax cuts.
- Criticism of inflationary pressures.
- Advocacy for relaxed regulatory policies.
Alignment with Trump's Economic Vision
Hassett's economic philosophy appears to align closely with President Trump's demands. Recently, he backed Trump's proposal to use tariff revenues to deliver cash to Americans, suggesting it could ease cost-of-living concerns. He indicated that an improving economy might support a plan for one-time $2,000 rebate checks for many citizens.
President Trump has consistently pushed for aggressively lower monetary policy rates. In a December address, he stated, "I'll soon announce our next chairman of the Federal Reserve, someone who believes in lower interest rates, by a lot." Hassett has publicly argued for a more accommodating monetary policy, though he has not explicitly endorsed slashing rates to the crisis-level 1% that Trump has sometimes demanded.
Timeline for the Announcement
While President Trump has hinted for weeks that he will announce the new Fed Chair 'soon', a final decision remains pending. However, Treasury Secretary Scott Bessent recently indicated that Trump could decide on Powell's successor as early as January. This sets the stage for a major economic policy shift in the United States, with global repercussions, as the May transition at the Federal Reserve approaches.
