Fed chair nominee Kevin Warsh: We are still dealing with legacy of 'policy errors in 2021 and 2022'

• Senator Scott raises concerns about AI's impact on employment, the Fed's nearly $7 trillion balance sheet, digital assets, and the importance of Fed independence.
• Warsh states that the Fed 'missed its mark' on price stability, leading to 25-35% price increases for Americans, and attributes this to 'policy errors' in 2021 and 2022.
• Warsh calls for 'fundamental policy reforms,' a 'regime change' in policy, a new inflation framework, and better communication from the Fed, suggesting less reliance on forward guidance.

Senator Tim Scott questions Fed Chair nominee Kevin Warsh on critical economic issues. Warsh criticizes the Federal Reserve's past policy errors in 2021 and 2022, particularly regarding inflation and forward guidance. He advocates for a 'regime change' in policy conduct, including a new inflation framework, different use of tools (favoring interest rates over the balance sheet), and new communications to avoid compounding errors.