Polymarket bettors are shifting their odds against Kevin Hassett following President Trump's recent statements suggesting he would like to retain him at the White House. Despite Trump's comments, a significant amount of money, totaling $11.4 million, is still wagered on Kevin Hassett securing the position.
During a White House event on Friday, President Trump publicly acknowledged Hassett, stating, "I see Kevin’s in the audience, and I just want to thank you. You were fantastic on television today. I actually want to keep you where you are, if you want to know the truth."
Following Trump's remarks, the odds of Kevin Warsh being nominated for the position surged to 60% on Polymarket by Friday afternoon. In contrast, traders assigned only a 17% probability that Hassett would be selected. As of today, Warsh's odds have stabilized at 56%, while Hassett's have slightly increased to 18%.
Hassett's Odds Hold Steady Amidst Presidential Ambiguity
For several weeks, President Trump has indicated that he is considering either Kevin Warsh or Kevin Hassett to succeed Jerome Powell as the Federal Reserve chair. He also stated that Treasury Secretary Scott Bessent has been ruled out as he wishes to remain in his current role. Among the potential nominees, Hassett is widely perceived as the most loyal to the President.
Similar to the situation with Scott Bessent, Trump's comments regarding Hassett conveyed a degree of uncertainty. Addressing White House Chief of Staff Susie Wiles on Friday, Trump remarked, "We don’t want to lose him [Hassett], Susie, but we’ll see how it all works out." This statement has led approximately 11 million bettors to believe that Hassett still has a viable chance at the nomination.
Current Fed Governor Christopher Waller, who was considered a long shot, ranked third with 15% odds. Traders assigned only an 8% chance for BlackRock executive Rick Rieder to secure the role.
The rise in Warsh's odds is largely attributed to his recent dovish stance. However, during his previous tenure at the Fed, Warsh was known for his hawkish views, expressing concerns about inflation and advocating for higher interest rates, even during periods of financial instability.
A team of Wells Fargo strategists noted earlier this year, "Warsh is a bit more of a wild card given past hawkishness and recent dovishness." Warsh also saw his odds increase to 59% on Kalshi, another prediction market, while Hassett and Waller received 18% and 14% odds, respectively.
President Trump has not yet announced a specific date for naming his choice for the next Federal Reserve chair. Jerome Powell's current term is set to expire in May, although he has the option to remain on the Fed's board until 2028. Powell has thus far declined to comment on his intentions regarding his future role.
Hassett Comments on Powell Amidst Federal Investigation
Concurrent with the selection process for the Fed chair, the Trump administration is conducting an investigation into Jerome Powell. As previously reported, Powell faces accusations of cost overruns related to a $2.5 billion project to renovate two historical buildings at the Federal Reserve's headquarters.
Powell has denied any wrongdoing, asserting that these actions are a pretext to pressure him for not complying with President Trump's persistent demands for significantly lower interest rates. The central bank implemented three quarter-point rate cuts last year, reducing the target range to between 3.5% and 3.75%.
The Federal Reserve has attributed the increased spending on the renovation project to unexpected material and labor costs, the discovery of more asbestos than anticipated, and soil contamination. The Fed stated that the project is expected to "reduce costs over time by allowing the Board to consolidate most of its operations."
In an interview with Fox Business Network, Kevin Hassett expressed that he wished there had been greater transparency from the Federal Reserve regarding the cost overruns associated with the building renovations.
"The bottom line is, I expect, you know, Jay is a good man – I expect that there’s nothing to see here, that the cost overruns are related to things like asbestos, as he says. But I sure wish they had been more transparent," Hassett stated.
Leaders of foreign central banks, former U.S. government officials, and current American lawmakers from across the political spectrum have criticized the investigation. Senator Thom Tillis (R-NC), a member of the Senate Banking Committee's slim Republican majority, threatened to block any of Trump's nominees for the Federal Reserve following the disclosure of the investigation.