Trump Has an Open Line to the Fed Chair. Nixon Tried That Too.

President Trump has called Federal Reserve Chair Kevin Warsh repeatedly since May, The Wall Street Journal reported. Trump reaches out in bursts, then goes quiet for stretches, people familiar with the calls said.

The calls have touched on how the Iran war and artificial intelligence (AI) are affecting the economy, the sources said. One person said rates have not come up since Warsh’s Senate confirmation. That keeps intact the wall between the White House and monetary policy.

A Bond Market Already on Edge

The contact lands as bond investors already question Warsh’s independence. Last week, the Federal Open Market Committee (FOMC) voted 9-3 to hold rates steady. Warsh then gave evasive answers at his press conference.

The 30-year Treasury yield jumped afterward to its highest level since before the 2007-08 financial crisis. Three FOMC members had pushed for an immediate hike. Warsh sidestepped questions about why he disagreed with them.

The three later explained their dissenting rate hike votes in separate remarks. That added to the sense that Warsh keeps his cards close to the vest. He also testified before Congress in July, weeks before the FOMC split became public.

Loretta Mester led the Federal Reserve Bank of Cleveland from 2014 to 2024. She said she wants confidence that the Fed knows what it is doing. She does not think Warsh’s approach of saying little is sustainable.

Nixon Tried This With Burns

Direct presidential contact with a Fed chair is not new. Nixon pressured Fed Chair Arthur Burns to loosen policy ahead of his 1972 re-election bid. Tapes released decades later capture that pressure campaign.

“I really don’t care what you do in [or after] April.”

Nixon told Burns that in February 1972. The exchange comes from a 2006 Journal of Economic Perspectives paper that transcribed the Nixon tapes.

Burns cut the discount rate before that November’s election. The following year, the federal funds rate jumped from 4.49% to 9.71% as the Fed reversed course. Inflation ran hot through the rest of the decade.

Historians still debate whether Burns acted from conviction or political pressure. Either way, the episode remains a cautionary tale about central bank independence.

Trump’s calls to Warsh look narrower than Nixon’s push for rate cuts. They have centered on Iran and AI, not borrowing costs directly. Still, the parallel adds context to the independence question trailing Warsh.

He gets another chance to address it at the Fed’s Jackson Hole retreat this month.