Hello everyone, I'm Kimberly Adams. Welcome back to Make Me Smart, where none of us is as smart as all of us.

Last week was a big news week for the Federal Reserve. We had an interest rate decision and a new Fed chair pick.

So today we're going to break it all down and get into what could come next.

And for that, we have our favorite Fed expert, Marketplace correspondent Nancy Marshall Ginsburg, here to make us smart about this. Nancy, welcome back.

Hi, Kimberly. Let's start with the big news. On Friday, President Trump announced who he was planning to nominate for the next chairman of the Federal Reserve, Kevin Warsh.

Tell us a bit about who he is.

Yeah, Warsh started his career in the 1990s on Wall Street. He was working in mergers and acquisitions at Morgan Stanley.

And then he worked his way over to former President George

W. Bush's National Economic Council serving on that. And then he ended up at the Federal Reserve.

He was a governor of the Fed from 2006 to 2011. And he really helped then chair Ben Bernanke during the financial crisis.

You know, he helped the Fed create some bailout plans for these huge financial giants that were teetering on the brink during the financial crisis because of his connections on Wall Street.

And he became known as the financial market whisperer,

you know, telling the Fed, here's what Wall Street thinks about what we're doing. Now he's a partner

of billionaire Stanley Drucken Miller helping Drucken Miller manage his money. He's also a senior

fellow at the Hoover Institution at Stanford. And those bank billouts were incredibly

controversial at the time. Based on Warsh's past, what might we expect from him as head of the

central bank? Well, he has argued quite publicly that it would be okay to lower interest rates now

because he says gains from AI in productivity

will damp down inflation so the Fed can and should cut interest rates to keep the AI boom going.

He says, we're going to have all these productivity gains.

We don't have to worry about inflation. We can go ahead and goose the economy, cut interest rates. Now, I wanted to talk to somebody who knows Warsh maybe worked with him. So I got a hold of Claudius Somm. She's chief economist at New Century Advisors, and she was an economist at the Fed from 2007 to 2019 when Warsh was there as a Fed governor, so she worked with him.

And she says it's not fair to brand Warsh as an inflation hawk that is somebody who prefers higher interest rates so that we don't have inflation. She says he's argued

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