President Donald Trump on Friday announced his selection of Kevin Warsh as the next chairman of the Federal Reserve Board of Governors, to succeed Jerome Powell, whose term expires in May. Warsh has experience as a Federal Reserve governor, but he turned into a leading critic of the central bank’s policies after the 2008 financial crisis and subsequent sluggish recovery. Despite Warsh’s reputation as an outsider and critic of the Fed, his selection met with some surprisingly positive responses.

“I am pleased to announce that I am nominating Kevin Warsh to be the CHAIRMAN OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM,” Trump announced on Truth Social, noting Warsh’s current positions with the Hoover Institution and the Stanford Graduate School of Business. “I have known Kevin for a long period of time, and have no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best. On top of everything else, he is ‘central casting,’ and he will never let you down.”

Warsh nearly got the job back in 2017, when he interviewed as a finalist to succeed outgoing Fed chairwoman Janet Yellen. However, Trump feared the then-47-year-old Warsh looked too youthful, according to The Wall Street Journal. Trump chose Powell instead, but he has increasingly sparred with Powell’s policies in his second term.

The decision received unqualified approval from The Wall Street Journal editors, who titled their response, “Kevin Warsh Is the Right Choice for the Fed.” The decision also reassured currency traders and helped to stabilize the U.S. dollar. Even Canadian Prime Minister Mark Carney, who seems to be building a Trump-critical brand, called Warsh “a fantastic choice to lead the world’s most important central bank at this crucial time.”

So, what makes Warsh the “right choice” for the job? Warsh joined the Fed as the youngest-ever governor at the age of 35. His 2006-2011 overlapped with the 2008 financial crisis and subsequent Great Recession, where he had a front-row seat to the Fed’s decision-making, and he became a strident critic of its quantitative easing measures. “Mr. Warsh’s experience in a crisis will be invaluable when the next one arrives, as it inevitably will,” argued the WSJ editors.

Warsh has also criticized the Fed’s “institutional drift,” writing in April 2025 that “forays far afield — for all seasons and all reasons — have led to systemic errors in macroeconomic policy. The Fed has acted more as a general-purpose agency of government than a narrow central bank.” Warsh has long angled to return the Fed to a narrow mission of focus on monetary policy, while leaving fiscal policy to Congress.

“He is very smart — both intellectually and in his ability to read the room,” said Warsh’s former Fed colleague Donald Kohn. Kohn disagrees with many of Warsh’s positions and “especially with the caustic tone with which they have been delivered,” but reasoned that “He knows he will need to use his considerable skills to marshal evidence and analysis to support the direction he wants to take policy.”

Before joining the Fed, Warsh worked on Wall Street for seven years, then joined President George W. Bush’s circle of economic advisors in 2002. (He also married Estée Lauder executive and heiress Jane Lauder, whose father Ronald is a Republican donor.)

Despite his experience in monetary policy, some have raised questions about his qualifications for the job, because he doesn’t have a Ph.D. in economics. “But how well have the hundreds of Fed Ph.D.s done in the last 20 years?” argued the WSJ editors. “They kept rates too low for too long in the 2000s, contributing to the housing boom and bust. They overestimated economic growth under Barack Obama, and underestimated it under Trump I. Then they missed entirely the Biden inflation. A non-economist can’t do any worse.”

The most intriguing feature of Trump’s selection is Warsh’s stance on inflation. Warsh is known for a hawkish approach toward inflation, which is usually associated with higher interest rates. But Trump in his second term has consistently pressured the Fed to lower interest rates, even coining derogatory nicknames for Chairman Powell. The DOJ launched a criminal probe into a Federal Reserve building renovation, but Trump distanced himself from the inquiry.

After months of resisting the pressure, the Fed finally cut rates at three consecutive meetings last year, in response to lackluster job growth. Nonetheless, it held interest rates steady at its January meeting, despite dissenting votes from two Trump appointees.

However, in a few short months, Powell will leave his position, and — with Senate confirmation — Warsh will succeed him. The question is, with his handpicked candidate in the top spot, will Trump’s rhetorical war on the Fed finally conclude?