Kevin Warsh sworn in as Fed chair

WASHINGTON - President Donald Trump on Friday held a swearing-in ceremony for new Federal Reserve Chair Kevin Warsh, a former central bank official-turned-critic and aide to former President George W. Bush.

Key facts

- Warsh, 55, earned a law degree from Harvard University in 1995 before becoming a banker at Morgan Stanley, where he later served as vice president and executive director before joining the Bush administration in 2002 as executive secretary at the National Economic Council.

- Bush nominated Warsh to serve on the Federal Reserve’s Board of Governors in 2006, with Warsh becoming the youngest person ever to join the central bank at 35.

- During the 2008 financial crisis, Warsh aided in the government’s bailout of insurer AIG and assisted in JPMorgan’s acquisition of Bear Stearns, an 85-year-old brokerage that collapsed as the investment banking industry failed.

- Warsh criticized the Fed’s decision to quickly lower interest rates during the financial crisis, arguing the cuts would only spur inflation, and was the only Fed official to argue against the central bank’s plan in 2011 to buy $600 billion in Treasury securities.

- He joined the Hoover Institution think tank after resigning from the Fed in 2011, and Warsh was among the finalists before Trump nominated Jerome Powell to succeed Janet Yellen as Fed chair in 2017.

- Warsh is a critic of Powell, telling CNBC last year he supported a “regime change” at the Fed, claiming its policy has been “broken for quite a long time” and arguing Trump was “right to be frustrated” with Powell’s refusal to lower interest rates more quickly.

News peg

Warsh was sworn in as Fed chair during a White House ceremony on Friday, launching Warsh’s four-year term leading the Federal Reserve, succeeding Powell, whose term ended earlier this month. Warsh was confirmed to a 14-year term as a Fed governor last week. His first Federal Open Market Committee meeting as Fed chair, during which governors decide whether or not to adjust interest rates, will take place June 16-17.

Powell to remain as Fed governor

Powell, whose term as Fed chair ends Friday, said last month he would stay on the central bank’s board as governor. Powell said his decision stemmed from a “series of legal attacks” facing the Federal Reserve, noting he would remain on the board “for a period of time to be determined,” adding, “I will leave when I think it is appropriate to do so.” His move to stay on the board is historically rare, and Powell will be the first former Fed chair to do so since Marriner Eccles, whose term ended in 1948, before he continued as governor until 1951. (Source: Forbes)