US President Donald Trump is reportedly considering four people to replace Federal Reserve Board of Governors member Adriana Kugler after her resignation becomes effective on Friday.
According to a Thursday Reuters report, Trump was weighing economic adviser Kevin Hassett, former Fed governor Kevin Warsh and two other people to replace Kugler by the end of the week. Whomever Trump nominates and is confirmed by the US Senate would have significant influence over the country’s monetary policy, including federal interest rates.
Hassett, also director of the National Economic Council under Trump, disclosed holding a stake in Coinbase Global worth between $1 million and $5 million as of June. Warsh, who served as a Fed governor from 2006 to 2011, reportedly said that blockchain technology could benefit the US central bank with its payment systems.
“Congress gave the Fed a monopoly over money,” Warsh said in 2018, according to The New York Times. “And if the next generation of cryptocurrencies look more like money and less like gold — and have less volatility associated with them so they would be not just a speculative asset but could be a reliable unit of account — as a purely defensive matter I wouldn’t want somebody to take that monopoly from me.”
The incoming nomination follows Kugler’s resignation on Aug. 1. No reason was given for her departure.
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Fed rates to influence US markets, including digital assets?
Trump has clashed with Fed Chair Jerome Powell, whom he nominated during his first term. The president has been publicly challenging the Fed’s independence in determining federal interest rates.
Many legal experts have suggested that Trump does not have the authority to fire Powell without cause, though an April Supreme Court decision expanded presidential powers over agencies previously considered independent from the presidency. That decision upheld Trump’s decision to remove members of the National Labor Relations Board and the Merit Systems Protection Board.
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