Powell Policy Proposal: Advocate for Simultaneous Interest Rate Cuts and Balance Sheet Reduction, Inflation is a Fed Choice

December 16: Top Trump ally John Wosah has emerged as the front-runner to become the next Federal Reserve Chair, with market odds of his appointment now leading past Hassett as of this date. In a recent research report, Deutsche Bank’s Matthew Luzzetti team noted that if Wosah takes the Fed helm, he could back interest rate cuts while pushing forward balance sheet reduction (QT)—though this dual outcome hinges on regulatory reforms that lower banks’ reserve demand, with short-term uncertainty still lingering. A leading candidate to succeed Powell, Wosah earlier this year argued “inflation is a choice,” claiming it stems not from supply chains or geopolitics but Fed policy decisions. He’s called for the Fed and Treasury to stick to their respective mandates (the Fed for interest rates, the Treasury for fiscal accounts) and urged the Fed to reform and refocus on its core price stability mission. Despite criticizing current policy, he’s extremely bullish on the U.S. economy, forecasting AI and deregulation will drive a productivity boom akin to the 1980s. By background, Wosah is a lawyer who served as a Federal Reserve Governor from 2006 to 2011, playing a key communications role during the global financial crisis. He’s long criticized the Fed’s aggressive 15-year balance sheet expansion, arguing quantitative easing (QE) has strayed from the central bank’s core functions. Currently, he’s a partner at the Druckenmiller Family Office’s Duquesne, a distinguished visiting scholar at the Hoover Institution, and a lecturer at Stanford Graduate School of Business. His cross-academia, regulatory, and investment experience gives him broad influence in monetary policy and financial markets. (Wall Street See News)