Trump appoints new Federal Reserve chairman! Walsh's hardcore network conceals market changes
Trump nominates Kevin Walsh to lead the Federal Reserve; this hawkish figure's comeback relies entirely on a golden network that spans politics and business! He is a protégé of Treasury Secretary Bessent, both mentored by legendary investor Druckenmiller, with policies highly aligned supporting AI deflation + interest rate cuts; his father-in-law is also Lauder, the heir to Estée Lauder—Trump's university classmate, who generously donated $5 million to become one of his core financial backers, providing strong political endorsement.
At the age of 55, Walsh holds a Harvard Law PhD, has experience at Morgan Stanley, and has served as a Federal Reserve governor, making him a key figure during the financial crisis. After being quiet in Silicon Valley for over a decade, he completed a hawkish turnaround using AI deflation theory, proposing "balance sheet reduction in exchange for interest rate cuts," which aligns with Trump's demand for rate cuts while stabilizing the market with a hawkish background, making it the optimal solution for the White House.
His nomination directly triggered market turbulence, with Bitcoin dropping over 20% in 24 hours, and precious metals experiencing an epic crash. The "balance sheet reduction + interest rate cut" combination puts the crypto market under liquidity tightening pressure. However, Walsh's path to rate cuts still faces uncertainties, as the FOMC voting mechanism limits his decision-making power, and the Senate confirmation process is further obstructed, making it difficult for the rate cut magnitude to meet White House expectations.
Now, the biggest question in the market is whether he is a steadfast hawk or a weather vane that shifts with the wind? Whether the AI deflation myth can be fulfilled is also the key to determining the success or failure of his policies.
Can Walsh's networking leverage the Federal Reserve's easing policies? How should the crypto market respond to the dual challenge of balance sheet reduction + interest rate cuts?
