IBM exec says Trump's Fed pick will 'overhaul' central bank policies while bringing crisis expertise

IBM Vice Chair Gary Cohn said President Donald Trump’s Federal Reserve nominee Kevin Warsh is uniquely positioned to overhaul the central bank, pointing to Warsh’s hands-on role during the 2008 financial crisis and his plans to return the Fed to traditional monetary and regulatory norms.

Cohn made the remarks Sunday during an appearance on CBS’ "Face the Nation," where host Margaret Brennan asked him about Trump’s pick to lead the Federal Reserve.

Cohn, who worked closely with Warsh during the financial crisis while at Goldman Sachs, said the former Fed governor understands how markets respond under stress and is prepared to roll back unconventional policies, including a bloated balance sheet, while focusing the central bank on its core economic mission.

"I think we're very fortunate to have Kevin to be the nominee," Cohn told Brennan. "Kevin has a unique background coming in as the chair."

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Cohn pointed to Warsh’s time at the Federal Reserve during the 2008 financial crisis, describing him as "instrumental" during the period.

"What I mean by that is when banks were going through stress, and we saw a lot of bank mergers, we saw a lot of assets being moved around the system, Kevin was the point person at the Fed," Cohn said. "He was involved in every one of those discussions."

"I truly believe without Kevin's expertise and without Kevin being there, we would not have come out of the 2008 crisis as well as we have," he said. "So, he's very highly qualified."

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Cohn expressed confidence that Warsh would steer the Federal Reserve back toward its traditional role, including focusing on monetary policy rather than non-financial issues.

"There’s a pressure right now for interest rates to go lower. I think that he will probably follow through on the one to two cuts this year," Cohn said. "Kevin also has a view that the Fed should not have the large balance sheet. You know, the Fed went in and bought enormous amounts of securities… I think that Kevin will reverse that."

Cohn said Warsh is a traditionalist who supports strong regulation that allows markets to grow while ensuring consumers have access to capital.

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"I think he is actually the right choice in this period of time," he said.

Trump formally announced Warsh’s nomination Friday, ending months of speculation over who he would choose to lead the central bank.

In announcing the pick, Trump said he has known Warsh for years and expressed confidence that he would rank among the most successful Fed chairmen in history.

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Warsh must still be confirmed by the Senate before taking over one of the most powerful positions in U.S. economic policymaking.

Before joining the Federal Reserve, Warsh worked in the private sector at Morgan Stanley and later served in President George W. Bush’s administration, building a reputation in Republican economic policy circles. Bush nominated him to the Fed’s Board of Governors in 2006, making him the youngest Fed governor in history at age 35.

Since leaving the Fed in 2011, Warsh has held academic and advisory roles, including serving as a Shepard Family Distinguished Visiting Fellow in Economics at the Hoover Institution and a visiting scholar at Stanford University’s Graduate School of Business. He also serves on the board of UPS and as a trustee of several prominent economic policy organizations.

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Warsh has been a familiar figure in past Trump administration deliberations, having been considered to replace Janet Yellen as Fed chair in 2017, when Trump instead selected Jerome Powell. He was also under consideration to serve as treasury secretary last fall before Trump nominated hedge fund manager Scott Bessent.

FOX Business’ Eric Revell contributed to this report.