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Kevin Warsh Nominated: Aiming to Shrink Fed's Balance Sheet

2/17/2026

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Summary

Story summary

Kevin Warsh is nominated to lead the Federal Reserve and aims to shrink the central bank's balance sheet.
Critics argue that the Fed's asset purchases distorted market prices and contributed to higher home values.
Some believe tighter coordination between the Treasury and the Fed could enable a smaller balance sheet.
Analysts caution that financial realities may limit changes and Warsh's plan may require regulatory reforms.

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Story summary

Kevin Warsh is nominated to lead the Federal Reserve and aims to shrink the central bank's balance sheet.
Critics argue that the Fed's asset purchases distorted market prices and contributed to higher home values.
Some believe tighter coordination between the Treasury and the Fed could enable a smaller balance sheet.
Analysts caution that financial realities may limit changes and Warsh's plan may require regulatory reforms.