Trump is considering having Walsh serve as Treasury Secretary first, and then as Chairman of the Federal Reserve

New news has emerged regarding the most fiercely contested position in Trump's cabinet—the appointment of the Secretary of the Treasury!

On Friday, according to informed sources, President-elect Trump is considering appointing Kevin Warsh as Secretary of the Treasury. Additionally, after Powell's term as Federal Reserve Chairman ends in 2026, Warsh may be nominated as Chairman of the Federal Reserve.

Some insiders stated that Trump met with Warsh at his private club Mar-a-Lago in Florida on Wednesday to discuss this possible arrangement. Previously, when Warsh unexpectedly entered the list of candidates for Treasury Secretary, U.S. Treasury bonds rebounded significantly.

It is worth mentioning that Warsh is one of the leading candidates for Secretary of the Treasury, but as of Thursday evening, Trump has not yet decided who will take on this key cabinet position. Insiders indicated that Trump is still weighing how to handle the vacancy at the Federal Reserve and may not make a final decision until Powell's term ends in May 2026.

Some insiders have indicated that Trump is considering appointing Bentsen to lead the White House Economic Council, and if Warsh becomes Chairman of the Federal Reserve, Trump would nominate Bentsen as Secretary of the Treasury later in his term.

This is exactly the "safe option" the market wants to see, with Warsh as Secretary of the Treasury. He has experience dealing with turmoil, is a proponent of free trade, and could potentially moderate Trump's extreme tariff policies while emphasizing fiscal discipline and opposing significant increases in debt. Bentsen serving as the Director of the White House Economic Council would be a "favorite among investors," and even if he is not nominated as Secretary of the Treasury, joining the White House Economic Council could help soothe the market.

However, Trump's aides have warned that he is easily swayed and may decide not to choose Warsh or Bentsen for these positions, opting instead for one of the other competitors to lead the Treasury, such as Apollo Global Management CEO Mark Rowan. Trump has been in closed-door discussions for several days about who to appoint as Secretary of the Treasury.

A Proponent of Free Trade, Supporter of Debt Control

Warsh has emerged as a leading candidate for Secretary of the Treasury, as Trump is prioritizing someone who can engage with the market—soothing investors through any upcoming turmoil amid escalating trade tensions and rising government debt. Notably, Warsh has a close relationship with Trump's supporters; his father-in-law, Ronald Lauder, has been a friend of Trump for decades.

The former Federal Reserve governor played a key role during the 2008 financial crisis when Fed Chairman Bernanke sent him to communicate with Wall Street, giving him experience in handling turmoil. Warsh has long been considered a candidate for Chairman of the Federal Reserve during Trump's second term, but it remains unclear whether he would still be eligible to run if he is selected as Secretary of the Treasury.

Warsh is also a proponent of free trade, previously disagreeing with the core trade policies of Trump's economic agenda. In a 2018 interview with the POLITICO podcast, he stated that if the U.S. wants to reduce its bilateral trade deficit, a "prudent" approach might be to urge the other party to reduce restrictions Analysis suggests that Wosh's views on trade policy may bring a moderating effect on Trump's tariff proposals.

If Wosh, who "previously supported free trade," takes this position, the market will focus on whether this will soften Trump's hardline stance on tariffs.

In addition, Wosh opposes increasing the debt burden. Although the Treasury Department does not have formal jurisdiction over the implementation of tariffs, Wosh may play a key role in negotiating the extension of the Republican tax cut policy set to expire at the end of next year, which may include tariffs as one of the methods to increase revenue and offset deficit impacts