The choice of Kevin Warsh as the next chairman of the Federal Reserve should end one of the grisliest embarrassments of Donald Trump's second presidency.

His cruel outbursts against departing Fed chairman Jay Powell, whom he relentlessly attacked for holding interest rates too high for too long, are a blot on his presidency and have been a cause for the market mayhem.

It led G7 central bankers to express their disgust and prompted financiers across the globe to abandon the greenback for gold and other precious metals.

Of all Trump's appointments, it is arguably the most critical. The US President has long sought to present himself as the creator of economic miracles, tackling affordability and bolstering growth.

His beef with Powell was the refusal of the Fed boss to bring down official interest rates, allowing middle-Americans to access home loans and credit more easily. Warsh is a Harvard-trained lawyer who picked up economic credentials en route.

He has recently aligned himself with the Fed doves, advocating faster rate cuts than the three delivered in 2025, even though he is a hawk by inclination. He also favours Trump's America First tariffs.

Much more will be learned of his view on interest rates, inflation, printing money and the US's swelling borrowing and debt needs when he faces forensic confirmation hearings before the Senate Banking Committee. 

It must endorse his appointment. Trump recognised the importance of the appointment and spent time interviewing candidates. 

He has avoided choosing someone from the MAGA Right. The calm selection bears the fingerprints of Treasury Secretary Scott Bessent.

Even though Warsh is associated with the free-market Hoover Institution at Stanford University, he is a conventional choice, having served as an independent Fed governor during the Great Financial Crisis (GFC) in 2008.

He acted as a conduit to Wall Street during a trauma when the US government took stakes in the banks. The former Morgan Stanley investment banker also has reach into the grandest echelons of American commerce through his marriage to cosmetics heiress Jane Lauder.

Warsh's knowledge of navigating financial perils parallels Sajid Javid's selection of Andrew Bailey as Bank of England governor to replace Mark Carney in 2020.

Bailey was in the engine room of the Bank in the GFC and later at the start of Covid. It is sometimes hard in Britain to recognise the importance of America's central bank.

Former chairmen changed the course of history. Paul Volcker, who took the helm in 1979, effectively cost Jimmy Carter his presidency when he beat back runaway inflation by sharply lifting rates and curbing credit. 

Volcker's successor Alan Greenspan was one of the greatest readers of the economic runes and the force behind the blistering growth in the 1990s and noughties. 

Ben Bernanke, a brilliant academic, steered America and the world through the GFC.

When push comes to shove, there is only one central bank with the resources and skills to stabilise the world's financial system. There will be sceptics who regard Warsh as a Trumpian placeman, ready to debase the currency and unfit to follow in the footsteps of giants.

Warsh's varied background, in and out of government, Wall Street and academia, suggests a cultured and questioning monetary leader who should be no one's patsy.