Warsh Plans to Overhaul the Fed & Carvana ‘Playground’ Disrupts Dealership Model

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**Neal Freyman** (0:29)
Good Morning Brew Daily Show. I'm Neal Freyman.

**Kyle Hagge** (0:32)
And I'm Kyle Hagge.

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Today, Kevin Warsh is shaking things up at the Fed.

**Kyle Hagge** (0:36)
And would you go on a 21-hour flight? It's Thursday, June 18th. Let's ride.

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Yeah, but is it getting us anywhere?

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I mean, it was supposed to handle the parts of the work I hate, but it just describes the problems back to me.

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Kevin Warsh is wasting no time shaking things up at the Federal Reserve. The new chairman who took over for Jerome Powell last month previewed sweeping changes coming to the Central Bank after his first meeting as the boss.
One thing that hasn't changed, interest rates. The Fed, as expected, kept rates steady, extending its long-running holding pattern as the US economy doesn't force its hand one way or the other. But that might not last much longer. A rate hike may well be coming. In the Fed's surprisingly hawkish projections, nine policy makers saw at least one rate increase this year. That's up from none as recently as March. That's because the war in Iran has caused inflation to reaccelerate, and the job market has been much more resilient than expected. A rate hike isn't a lock, though. The other nine policy makers predicted rates to hold steady or decline by the end of 2026 As Kevin Warsh put it, the discussion was a good family fight over monetary policy, which is definitely what my family fights over. After the rate decision was released, Warsh stepped up to the podium and detailed how he planned to overhaul the Fed. He's launching task forces. He wants to modernize data collection. He's curbing communications. He's scaling back forward guidance. Taken together, it amounts to a new look Fed that's going to be much more tight lipped about its decisions. Kyle, Warsh is going full monk mode.

**Kyle Hagge** (3:27)
He is. Monk mode has been activated. I mean, this guy must have watched too much Parks and Rec. He loves a task force. He just wants committees after committees after commitments. And it's interesting. This is like maybe like a soft regime change when it comes to what the Fed is going to do. I think a lot of people maybe thought it was going to be about substance and what they did with the interest rates. But he's kind of keeping a normal theme there. But it's a lot more about style. He wants to have his communications be a lot more tight-lipped. They're way shorter than what Jerome Powell, the former Fed chair would say. He's also, as we mentioned, doing a lot of these task force to identify where the Fed can improve and kind of pull back maybe what it's projecting future states will be. There's maybe nothing more factor of this than the dot plot that the Fed normally does.