Treasury Secretary Scott Bessent has confirmed the administration is actively interviewing candidates for the next Federal Reserve Chair, seeking a leader committed to shrinking the central bank’s footprint and ending the era of perpetual quantitative easing (QE).
The ‘Engine of Inequality’
Speaking on the All-In Podcast for a year-end economic review, Bessent outlined a sharp pivot from the monetary policies of the last 15 years. He argued that the Fed’s “gain of function” experiments—specifically the large-scale asset purchases that began in 2008—must be rolled back to restore economic fairness.
Bessent delivered a critique of post-GFC monetary policy, labeling the Federal Reserve “the engine of inequality.” He argued that while the Fed is not responsible for creating equality, it should not actively exacerbate the wealth gap.
“We ended up with this two-tier economy where either you were an asset holder, or you weren’t,” Bessent said. He contended that by keeping interest rates artificially low and buying trillions in assets, the Fed inflated the portfolios of the wealthy while leaving Main Street behind.
“The Fed engaged in… modern monetary practice,” Bessent noted, referring to the monetization of government debt. He stressed that the next Chair must view QE solely as an emergency tool, not a standard operating procedure.
See Also: Trump Says Next Federal Reserve Chair Likely Warsh Or Hassett: ‘I Think The Two Kevins Are Great’
Shrinking The Institution
Beyond monetary policy, Bessent called for a structural downsizing of the Federal Reserve itself. He criticized the institution’s lack of budgetary oversight, noting it “prints its own money” and operates without the fiscal discipline required of other government agencies.
“Everyone wants to see a smaller footprint and more predictability,” Bessent said of the candidates currently being vetted.
He emphasized that the central bank should fade into the background rather than having markets “hinge on every word” from the Chair.
Shortlisted Candidates
Bessent confirmed he has conducted deep-dive interviews with top contenders, including Kevin Warsh, Kevin Hassett, and Governor Chris Waller.
He indicated that the finalists share the administration’s vision for a “traditional” Fed: one focused on price stability rather than managing the entire economy.
“I understand probably better than just about anybody… what needs to be done,” Bessent concluded, signaling that the nomination will be imminent as the administration prepares for 2026.
S&P 500, Nasdaq, Dow Jones Gain Year-To-Date
After a series of federal and economic headwinds, the stock market remained resilient in 2025, with all three major U.S. benchmark indices advancing throughout the year.
The S&P 500 was 17.74% higher, whereas the Nasdaq Composite and Dow Jones gained 22.20% and 14.27%, respectively, on a year-to-date basis.
The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, closed higher on Tuesday. The SPY was up 0.46% at $687.96, while the QQQ advanced 0.47% to $622.11, according to Benzinga Pro data.
The futures of Dow Jones, S&P 500, and Nasdaq 100 indices were lower on Wednesday.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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