Kevin Warsh will become Chair of the Federal Reserve next week. Bill Dudley comment.
Kevin Warsh has been critical of the central bank and promised “regime change.” What should Warsh do to improve how the Fed conducts and implements monetary policy?
A Group of Thirty working group that I led released a report today,
The Federal Reserve’s Monetary Policy Framework: More to Do to Buttress Independence, that suggests a way forward.
https://group30.org/publications/detail/6170
The report recommends the Fed develop a comprehensive framework for quantitative easing and tightening, including providing clarity about when QE might be appropriate and its objectives.
The report suggests a thorough examination of the costs and benefits of shrinking the size of the Fed's balance sheet, including consideration of whether the current "ample" reserves regime should be retained.
The report recommends the Fed publish a staff forecast with alternative scenarios at the conclusion of each Federal Open Market Committee meeting to facilitate better understanding of the Fed's economic outlook.
Bill Dudley Bloomberg May 7, 2026
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