Opinion

PETER NAVARRO: Powell’s shadow Fed majority could threaten jobs, housing and growth

Jay Powell lost the chairmanship. He may still control the reaction function

By Peter Navarro Fox News

Published May 24, 2026 5:00am EDT

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WATCH LIVE: Trump swears in Kevin Warsh as new Fed chair

Kevin Warsh was confirmed by the Senate to replace outgoing chairman of the Federal Reserve Jerome Powell.

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Kevin Warsh has now been sworn in as the new Federal Reserve Chair. Outgoing Chair Jerome Powell has refused to leave the Fed Board of Governors, breaking with the modern custom that departing Fed chairs leave the Board rather than linger as rival power centers.   

The clear danger: Powell will have enough Board support to act as Fed Shadow Chair and force a series of rate hikes down Warsh’s throat. 

Never mind that even a single rate hike would be the worst possible response to an oil-price shock. Never mind that two of Jay Powell’s predecessors understood the difference between demand inflation and an oil shock. 

When Iraq invaded Kuwait in 1990, Alan Greenspan understood that an oil shock can both raise headline inflation and damage growth. His FOMC repeatedly cut the federal-funds rate as the economy weakened.

TRUMP'S FED CHAIR PICK KEVIN WARSH IGNITES FIGHT OVER INDEPENDENCE........

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