SOTS 2nd Hour: Fed Chair Nominee Senate Confirmation Hearing - LIVE 4/21/26

SPEAKER_1 (0:00)

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Elizabeth Warren (0:29)

Courage.

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I learned it from my adoptive mom.

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Hold my hand.

Elizabeth Warren (0:33)

You hold my hand.

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Elizabeth Warren (0:39)

You can't imagine the reward.

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Department of Health and Human Services and the Ad Council.

Sara Eisen (0:48)

Good Tuesday morning. Welcome to Squawk on the Street. I'm Sara Eisen with David Faber and Mike Santoli today, live from post 9 of the New York Stock Exchange. Carl has the morning off.

Moments away, Fed Chair nominee Kevin Warsh facing his first big confirmation test with a much awaited hearing in front of the Senate Banking Committee as big questions remain around Fed independence, the ongoing investigation into the current Fed Chair, Jay Powell. We're going to take you live to the Capitol. When that hearing begins, listen to comments and questions and statements from the lawmakers and from Kevin Warsh. Guys, there was a setup because Warsh released his opening testimony here. I think this was the money line because it kind of gets to the heart of what I think a lot of the questions will center around, which is Fed independence. Here's what we expect the nominee, Kevin Warsh, to say. I do not believe the operational independence of monetary policy is particularly threatened when elected officials, presidents, senators or members of the House state their views on interest rates. Central bankers must be strong enough to listen to a diversity of views from all corners. In other words, we can still be independent and tune out the noise when the president tells us we want lower interest rates. So expect to hear that kind of thing. And we heard from President Trump this morning on Squawk Box, and he very much made clear he still expects lower interest rates and is going to keep the heat on with this criminal investigation against Powell and railed against how expensive the Fed renovation, the building was again.

David Faber (2:19)

Right, which then puts the focus back on, I guess, Senator Tillis, what has been his continued opposition to confirming worse if that investigation continues.

Sara Eisen (2:30)

Correct. And that's going to be the barrier, the roadblock here.

David Faber (2:32)

And then when does Powell's turn up?

Sara Eisen (2:34)

May 15

David Faber (2:35)

And so what would happen if we didn't have a confirmed nominee?

Sara Eisen (2:39)

Well, you could have Powell, as he said, laid out before, stay in the role.

David Faber (2:44)

And then didn't Trump say he would fire him?

Sara Eisen (2:47)

Well, Trump has said that. But I think Trump is fighting a Supreme Court battle now in terms of whether he has the authority to fire Fed governors.

David Faber (2:54)

He did say last week that he would fire, I thought, in another interview, that he would fire Powell.

Sara Eisen (2:59)

He's threatened that for a while.

David Faber (3:00)

But it was much more specific to if he stays in his current position.

Michael Santoli (3:03)

I was going to say, clearly, a lot of the-

Sara Eisen (3:04)

It's quite questionable whether he can, honestly, legally.

Michael Santoli (3:06)

And a lot of the question clearly is going to be about Warsh, whether he will be responsive to the economy or the stats.

SPEAKER_5 (3:11)

Any comments on the Powell investigation? Okay.

Sara Eisen (3:18)

Doesn't look like he was up for some questions from-

Michael Santoli (3:20)

Emily from Emily Wilkins.

Sara Eisen (3:21)

Nice try, Emily.

Michael Santoli (3:23)

Give him a try.

Sara Eisen (3:24)

Obviously, going into the hearing room, he's going to face senators. I think one of the big questions is how he deals with the fact that the president has made it very clear that he wants lower interest rates. And does that mean that he's beholden to him, especially at a time where the CPI, the inflation rate, at least at the headline level, has moved up because of higher oil prices?

Michael Santoli (3:45)

And, you know, I don't think anybody would object to those comments that Warsh has prepared about how, you know, we can still be independent if people express their views. When the president threatens to fire the chair of the Fed, that's a different thing than simply public officials stating their views on interest rates. So I do think that's where the bridge is. I have said...