The US Treasury Secretary has confirmed that the government is actively interviewing candidates for the next Federal Reserve Chair. The ideal candidate must commit to reducing the Fed's operational scope and ending the era of "permanent quantitative easing" (QE).
During an annual economic review on the "All-In" podcast, the Treasury Secretary signaled a dramatic shift from the monetary policies of the past 15 years. He argued that the Fed's "mission creep"—particularly its large-scale asset purchase programs since 2008—must be rolled back to restore economic fairness.
Criticizing post-financial crisis monetary policies, he called the Fed an "engine of inequality." While acknowledging that the Fed isn't responsible for creating equality, he stressed it shouldn't actively widen wealth gaps.
"We've ended up with this two-tier economy: you either own assets or you don't," he noted, explaining how artificially suppressed interest rates and trillions in asset purchases boosted wealthy investors' portfolios while leaving ordinary Americans behind.
The Secretary highlighted the Fed's engagement in "modern monetary practice"—effectively monetizing government debt. He emphasized the next Chair must treat QE strictly as an emergency tool, not standard policy.
Beyond monetary policy, the Secretary called for structural downsizing at the Fed, criticizing its lack of budget oversight. He pointed out the central bank "prints its own money" without the fiscal discipline required of other government agencies.
Regarding current candidates under review, he stated: "All want to see a smaller institution with greater predictability." The Fed should operate in the background, he added, not make markets "hang on every word from the Chair."
The Secretary confirmed in-depth interviews with several top contenders, including Kevin Warsh, Kevin Hassett, and Fed Governor Waller. Finalists reportedly share the administration's vision of a "traditional" Fed focused on price stability rather than managing the entire economy.
"I probably know better than anyone...what needs to be done," he concluded, suggesting an announcement is imminent as preparations begin for 2026.
Despite policy and economic headwinds, US stocks showed resilience in 2025, with all three major indices posting gains: the S&P 500 rose 17.74%, while the Nasdaq Composite and Dow Jones gained 22.20% and 14.27% respectively.
