In May 2026, Jerome Powell's tenure as chair of the US Federal Reserve comes to an end. His replacement is Kevin Warsh — a former Fed governor and Donald Trump's hand-picked choice to lead the world's most powerful central bank. The appointment has been anything but quiet, arriving against a backdrop of sustained political pressure from the Trump administration, public attacks on Powell, and a criminal investigation into cost overruns at the Fed building.

But beyond the politics, what does the leadership change actually mean for US monetary policy, for inflation, and critically, for Australian investors and retirees?

To break it all down, Mitchell is joined by Kris Bernie, portfolio manager at fixed income specialist Kapstream Capital. Kris is responsible for macroeconomic research, asset allocation, and interest rate and foreign exchange trading — which means he watches the Federal Reserve more closely than most.

What you'll learn in this episode

- Why the Fed chair matters to Australians — from equity markets and the Aussie dollar to term deposit rates

- Who Kevin Warsh is and why Trump picked him

- How Warsh's inflation-focused philosophy differs from Powell's dual-mandate approach

- The political pressure Warsh is likely to face — and its limits

- Why he's still just one vote of twelve on the FOMC

- The difficult environment he's inheriting: sticky inflation, a bloated Fed balance sheet, and stagflation risk

- What happens to Australia if the US consumer runs out of steam

Topics covered

- Why the Fed chair matters to Australian investors and retirees

- Who is Kevin Warsh, and why did Trump pick him?

- How Warsh's philosophy differs from Powell's

- Rules-based vs discretionary monetary policy, and what the Taylor Rule actually means

- How much influence can Trump realistically exert over the Fed?

- The stagflation risk: tariffs, oil prices, and second-round inflation effects

- The US consumer: how tapped out are they, really?

- Australia's idiosyncratic inflation problem and the RBA outlook

- How Kapstream is positioning across credit spread duration and rates duration

- Can AI productivity gains actually move the dial on inflation?

- Kapstream's listed ASX products, including XCAP

Episode Resources

Kapstream Website

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DISCLAIMER:

This podcast contains general financial information only. That means the information does not take into account your objectives, financial situation, or needs. Because of that, you should consider if the information is appropriate to you and your needs, before acting on it. If you’re confused about what that means or what your needs are, you should always consult a licensed and trusted financial planner. Unfortunately, we cannot guarantee the accuracy of the information in this podcast, including any financial, taxation, and/or legal information. Remember, past performance is not a reliable indicator of future performance. The Rask Group is NOT a qualified tax accountant, financial (tax) adviser, or financial adviser. Access The Rask Group's Financial Services Guide (FSG): https://www.rask.com.au/fsg

KAPTREAM DISCLAIMER:

This is general information only and does not take into account your personal objectives, financial situation or needs. Before acting on the information, consider its appropriateness to your circumstances and read the Product Disclosure Statement (PDS) and target market determination (TMD) on our website. Fidante Partners Limited ABN 94 002 835 592 AFSL 234668 is the responsible entity and issuer of interests in the Kapstream Absolute Return Income Fund and the Kapstream Absolute Return Income Active ETF.

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Inside Trump's pick to replace Jerome Powell