Kevin Hassett to Replace Powell? Buzz Heats Up as Trump Reportedly Locks In His Next Fed Chair Pick!
Trump’s Potential Pick for Fed Chair Sparks Market Buzz as Polymarket Shows 81% Odds for Kevin Hassett
As the United States edges closer to a pivotal shift in economic leadership, the future of American monetary policy has taken center stage. Former President Donald Trump, now preparing for a return to office, has signaled that he is close to announcing his choice for the next Federal Reserve Chair. And according to prediction markets, one name has surged far ahead of the rest: Kevin Hassett.
Hassett, a long-time economic adviser within Trump’s orbit, is now the overwhelming favorite on Polymarket, where traders are pricing in an 81 percent chance that he will be nominated. Just one month ago, his odds were barely half that—hovering at 40 percent—making the recent jump both dramatic and revealing.
If confirmed, Hassett’s appointment would mark a significant shift in direction for the Federal Reserve, which has maintained a cautious, inflation-focused stance under current Chair Jerome Powell. Analysts believe a Hassett-led Fed could pursue rapid rate cuts, more growth-oriented policies, and potentially recalibrate the central bank’s independence in the process.
With markets already responding, expectations are rising that 2026 could usher in one of the most consequential economic pivots in recent history.
Kevin Hassett Emerges as Trump’s Clear Favorite
Kevin Hassett, respected for his pro-growth ideology and known for co-authoring the book Dow 36,000, has long been seen as a prominent voice in Republican economic policy. His background includes serving as the Chairman of the Council of Economic Advisers during Trump’s first term, as well as directing the National Economic Council.
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| Source: The Kobeissi Letter X |
But his renewed prominence comes not from his résumé alone. It is his alignment with Trump’s economic vision—lower taxes, deregulation, and a more aggressive approach to economic stimulus—that appears to be driving his momentum.
Prediction markets, traditionally seen as early barometers of political moves, have reacted quickly. The rapid surge from 40 percent to 81 percent odds in just a few weeks suggests that traders believe the decision is all but finalized.
Analysts say such a spike is unusual unless insiders or market observers feel confident that information is pointing in one clear direction.
This surge has set financial circles buzzing, with many interpreting the rise as a sign that Trump’s inner circle may already be preparing for a significant recalibration of monetary policy.
A Potential Policy Pivot: What a Hassett Federal Reserve Might Look Like
If Kevin Hassett does become the next Fed Chair, the shift in Federal Reserve policy could be immediate and sweeping. Economists note that Hassett has, throughout his career, leaned toward supply-side stimulus, tax reduction, and pro-business regulatory approaches.
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| Source: X |
Under a Hassett-led Fed, analysts expect:
1. Faster and Deeper Interest Rate Cuts
Hassett is believed to support more aggressive rate-cutting strategies compared to the more measured approach of Chair Jerome Powell.
This could include:
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earlier policy pivots in response to slowing growth
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structured rule-based monetary policy
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public transparency reforms to align the Fed more closely with fiscal goals
Many Republicans have long criticized Powell’s cautious approach, especially during periods of post-pandemic inflation. Hassett’s appointment could represent an ideological realignment toward growth over caution.
2. Potential Changes in Federal Reserve Independence
While no formal policy proposals have been released, some economists say Hassett’s close alignment with Trump could lead to greater political influence on the Fed’s decision-making process.
This raises questions about:
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how markets might react to perceived politicization
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whether long-term inflation expectations could shift
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how global investors might view the stability of U.S. monetary policy
Still, supporters argue that the Fed has historically adapted to shifts in leadership and political philosophy, and that pro-growth strategies may help strengthen U.S. competitiveness.
3. A Broader Fiscal Stimulus Strategy
Trump’s economic team has already floated ambitious fiscal ideas for 2026, including large tax refunds and potential dividend-style payouts linked to Trump-era tax cuts.
Treasury Secretary Scott Besset recently hinted at major tax refund disbursements slated for the first quarter of 2026. Historically, similar payouts under the Trump administration averaged around $1,700 per filer, providing a significant consumer boost.
If combined with lower interest rates, the U.S. could see:
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increased consumer spending
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short-term equity market surges
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inflationary pressures reminiscent of 2020 and 2021
Some analysts warn that aggressive stimulus could risk repeating past price spikes, while others say the boost may be needed to counter slowing economic momentum.
Market Reactions: Optimism, Caution, and Elevated Speculation
Financial markets are already reacting, even though no official announcement has been made.
Equity Markets Show Growing Enthusiasm
Investors have begun positioning for:
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rate-cut-driven rallies
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increased liquidity
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heightened earnings potential in interest-sensitive sectors
Early trading activity suggests that sectors such as tech, real estate, and commodities—including gold—are seeing renewed attention.
Concerns Over Inflation and Asset Bubbles
Not all reactions have been positive.
Economists caution that rapid monetary easing, paired with large fiscal stimulus, could generate:
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elevated inflation
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asset bubbles
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higher long-term interest rates
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potential instability in lending markets
The memory of the 2020–2021 stimulus era still hangs over these discussions, particularly as inflation peaked near 7 percent in its aftermath.
Polymarket Sentiment Holds Strong
The prediction market’s confidence in Hassett—now at 81 percent—has become a focal point of discussion.
Such levels typically suggest that:
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insider expectations are shifting
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political momentum has solidified
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market actors believe an announcement is imminent
It has also fueled debate within economic research circles about whether prediction markets can reliably anticipate high-level political appointments.
Trump to Make a Major Announcement
Adding further suspense, President Trump is scheduled to deliver a major announcement from the Oval Office on December 3, 2025, at 2:30 PM ET.
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| Source: X |
While the White House has not confirmed the topic, speculation ranges widely:
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potential immigration reforms affecting labor markets
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new economic relief measures
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updates on fiscal policy plans
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early clues about the next Federal Reserve Chair
Recent policy statements from Trump have continued to emphasize populist, pro-growth themes, including:
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a $6.25 billion commitment supporting U.S. children
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agreements to reduce costs of major weight-loss drugs
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pushes for streamlined regulatory frameworks
Given the timing and the rising public focus on the Fed appointment, markets will be closely watching the address for signals.
Conclusion: A Potential New Economic Era Approaches
As Kevin Hassett’s likelihood of becoming the next Federal Reserve Chair continues to grow, markets and policymakers alike are preparing for a possible shift in the trajectory of U.S. monetary policy.
A Hassett-led Fed could:
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usher in aggressive growth strategies
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accelerate interest rate reductions
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coordinate more closely with fiscal stimulus programs
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redefine the balance between independence and executive influence
The coming weeks are expected to bring clarity. But for now, the surge in Polymarket odds has ignited significant debate, leaving investors bracing for both short-term volatility and long-term consequences.
Whether this signals a new chapter of bold economic expansion—or a period of elevated uncertainty—will depend largely on the decisions unfolding in early 2026.
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