Trump Seeks to Change Powell’s Path to Legal Probe, Clearing the Way for Wash to Take Over the Fed

BlockBeats News, April 24th - Trump recently stated that he is open to an "alternative way" to investigate Federal Reserve Chairman Powell. This statement is seen by the outside world as a potential "step" to resolve the current nomination deadlock of the Federal Reserve Chairman and clear the way for Kevin Warsh to take over. When asked if an entity outside the Justice Department could intervene in the investigation, Trump said, "Yes, it's actually very easy to do." Analysts believe that this may indicate Trump's willingness to transfer the investigative function from the Justice Department to Congress or other independent agencies.

Currently, Trump's nominated Federal Reserve Chairman candidate Kevin Warsh is in an awkward "stalemate." Despite Warsh's steady performance at the Senate Banking Committee hearing and his strong display of independence, North Carolina Senator Thom Tillis has made it clear that he will block Warsh's nomination confirmation due to the U.S. Department of Justice's criminal investigation into the renovation costs of the Federal Reserve headquarters and Powell's related testimony.

Tillis, as a key vote on the committee, has taken an extremely tough stance: as long as the Justice Department does not stop the investigation into Powell, he will not approve Warsh's nomination. Once this "investigation detour" plan is implemented, it may provide Tillis with a reason to withdraw his opposition vote, thus breaking the current deadlock.

At Tuesday's hearing, Warsh tried to establish himself as a defender of the Federal Reserve without angering Trump. When asked how he would respond if Trump requested a 1% interest rate, Warsh refused to take a predetermined position, only stating that "the Federal Reserve's independence should be decided by its leadership." Even when facing a highly politically provocative question like "whether Trump loses the 2020 election," he cleverly avoided it by stating "the Federal Reserve does not interfere in politics."

Current Chairman Powell remains firm in his stance, clearly stating that as long as the Justice Department's investigation is ongoing, he will continue to serve as a Federal Reserve Board member after his term as chairman expires. If Warsh cannot be confirmed by mid-May, he will continue to serve as Acting Chairman in accordance with the law.