Washington — IBM Vice Chairman Gary Cohn said Sunday that President Trump’s nominee for chairman of the Federal Reserve Board is “very highly qualified” and will “take the Fed back to its traditional” norms.
“I think we’re very fortunate to have Kevin to be the nominee,” Cohn said on “Face the Nation with Margaret Brennan.”
On Friday, Mr. Trump announced that he had nominated Kevin Warsh to serve as the next chair of the Federal Reserve Board, writing in a post on Truth Social that he has “no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best.”
Warsh, 55, served on the Fed board of governors between 2006 and 2011, becoming the youngest member in the board’s history. More recently, he’s worked with billionaire investor Stanley Druckenmiller and held academic positions, including at the Hoover Institution.
Cohn, the former National Economic Council director in President Trump’s first term, praised Warsh on Sunday, saying that he brings a “unique background” and highlighting his work on the Fed board during the 2008 financial crisis.
“He was instrumental in that crisis,” Cohn said. “Kevin was the point person at the Fed — he was involved in every one of those discussions. And I truly believe, without Kevin’s expertise, and without Kevin being there, we would not have come out of the 2008 crisis as well as we have.”
The president’s selection of Warsh as his nominee was expected to be viewed as a safe choice on Wall Street given his monetary policy experience and well-established views on inflation.
Cohn said he expects Warsh to “stay out of a lot of the non-financial issues,” while he is “going to be involved, obviously, in setting interest rate policy.”
“There is a pressure right now for interest rates to go lower,” Cohn said. “I think that he will probably follow through on the one to two cuts this year.”
The IBM vice chairman said Warsh “also has a view that the Fed should not have the large balance sheet.”
“The Fed went in and bought an enormous amount of securities. I think that Kevin will reverse that,” Cohn said. “I think he will be looking for the Fed to sell down their balance sheet.”
On the regulatory front, Cohn said Warsh “is a traditionalist, believing that we need strong regulation in the United States.”
“But it has to be regulation that works and allows the market to grow and allows the consumer to have access to capital,” Cohn said.
Cohn concluded, “I think he is actually the completely right choice in this period of time.”
The nomination comes after Mr. Trump has for months regularly disparaged Federal Reserve Chairman Jerome Powell, pressing him to lower interest rates while musing about firing him — sparking concerns about the Fed’s independence. Powell has led the Fed since February 2018 and his term ends in May 2026.
Cohn insisted Sunday that “the president completely understands the independence of the Fed,” adding that “Kevin has been a staunch advocate for independence of the Fed” as well.
With the nomination, the Senate will have to confirm Warsh to the post. But the confirmation process is expected to be an uphill battle after Powell revealed earlier this month that the Fed had received subpoenas threatening him with criminal charges. Powell argued that the investigation was part of an attempt to intimidate the Fed for its interest rate decisions, undermining its independence. Sen. Thom Tillis, a North Carolina Republican, has vowed to oppose all Fed nominees “until this legal matter is fully resolved.”
