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Everything You Need To Know About Kevin Warsh

The Macro Institute's Weekly Economic Primer

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The Macro Institute
May 26, 2026

Don’t have time to watch the whole video? Here’s 5 Key Takeaways:

🔹Fast Facts On Kevin Warsh: Fed Chair Warsh was previously passed over twice by President Trump, he is the richest Fed Chair in history due to his marriage to Jane Lauder, and was the youngest Fed Governor ever when he was appointed to the role by George W. Bush at the age of 35.

🔹Warsh Was A Principled Hawk In His Early Career: One of the more notable aspects of his time as a Fed Governor was steady hawkishness throughout the global financial crisis. Even as the unemployment rate approached double digits, Warsh maintained concern over inflation.

🔹Warsh Resigned As Fed Governor: He resigned as Fed Governor on March 31, 2011, just five years into his 14-year term. He did so in protest of QE2. Around this time, investor confidence in Ben Bernanke, the Fed Chair at the time, plummeted.

🔹Warsh Has Been Quite Inconsistent Of Late: Since 2018, Warsh has frequently changed his stance on monetary policy as the political party in the White House has changed. During Trump 1.0 and 2.0, he was been remarkedly dovish, while during the Biden presidency we saw his typical hawkishness.

🔹Bond Markets Have Confidence In The Federal Reserve: Despite concerns around the Fed’s independence, market-based estimates of long-term inflation expectations are anchored just above 2%. This shows that investors believe the Fed will continue to pursue monetary policy in line with their current 2% inflation target.

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Macro Data Center

The Macro Week Ahead

📆 Last Week’s Data Key Takeaways

🔹 FOMC Minutes Confirmed A Fed Boxed In By Inflation: The April minutes (Powell's last) revealed a committee grappling with a deteriorating inflation picture. The information available at the time of the indicated that inflation remained elevated and had moved higher, with the conflict in the Middle East continuing to be a key factor driving asset price movements. Markets read the minutes as hawkish.

🔹 Housing Starts Slipped Under Rate Pressure: Housing starts fell -2.8% M/M in April to a 1.465M annualized rate, down from the March estimate of 1.507M. The weakness was concentrated in single-family. Single-family housing starts in April were at a rate of 930,000, which is 9% below the March figure. Builders are pulling back on single-family as mortgage rates near one-year highs.

🔹Homebuilder Sentiment & Pending Sales Edged Up: The NAHB Index rose 3 points to 37 in May, marking the 25th consecutive negative reading. Housing remains soft as higher mortgage rates, rising gas prices, and economic uncertainty dampen buyer demand. Pending home sales increased by 1.4% M/M in April and rose 3.2% year over year, with NAR's Yun citing "cautious optimism" from buyers.

🔹 Consumer Sentiment Collapsed To A Record Low: The UMichigan Consumer Sentiment reading for May came in at 44.8, a 5-point drop from April and below the 48.2 estimate. It was the third straight monthly decline and a record low. Inflation expectations kept drifting higher. 1-year expectations inched up to 4.8% while long-run 5–10 year expectations climbed from 3.5% to 3.9%, a 7-month high.

🔹 Labor Market Showed Early Cracks As Firms Cut Jobs: While claims stayed historically low, forward-looking data flashed warning signs. The S&P PMIs showed jobs were cut in May as firms worried about rising costs and the economic outlook. Combined with the Philly Fed's employment index remaining negative, this suggests the "low-hire, low-fire" equilibrium may be tilting toward layoffs.

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