WSJ What’s News: Why Kevin Hassett Appears to Be Trump’s Pick for the Next Fed Chair

Date: December 3, 2025
Host: Sabrina Siddiqui (for The Wall Street Journal)
Episode Focus: Examining President Trump’s likely pick for the next Federal Reserve Chair, trends in U.S. regulatory policy, and breaking national security developments.

Main Theme

This episode zeros in on President Trump’s narrowing selection for the next Federal Reserve Chair, signaling a strong move toward Kevin Hassett. The discussion explores how Trump’s desire for loyalty and market credibility inform his choice, while also covering significant regulatory rollbacks in auto fuel standards and developments in U.S. defense policy, including the “Signalgate” messaging app controversy and new Pentagon drone initiatives.

Key Discussion Points & Insights

1. Trump’s Fed Chair Selection Process

• White House Cancels Fed Chair Interviews:
  The administration unexpectedly calls off interviews with finalists for the Federal Reserve Chair position, suggesting the decision process has concluded ahead of schedule.

  • “The White House abruptly canceled interviews that were scheduled for this week, with a group of finalists being considered for the job.” (00:55)

• President Trump’s Public Hints:
  Trump publicly acknowledges Kevin Hassett as a frontrunner, calling him a “respected person” in a recent meeting.

  • Trump: “I guess a potential Fed chair is here, too. I don't know. Are we allowed to say that? Potential? He's a respected person, that I can tell you. Thank you, Kevin.” (00:14)

• Significance of Kevin Hassett:
  Nick Timoros, WSJ’s chief economics correspondent, explains why Hassett is the likely pick:

  • Trump’s desire for loyalty after his dissatisfaction with current chair Jerome Powell.
  • Hassett is a “conventional, credible, conservative economist” who is market-friendly and not seen as a partisan risk.
  • “He’s somebody the president trusts...and he’s been furious with [Powell’s] decision ever since because he thinks Powell hasn’t rewarded him with loyalty and he doesn’t want to make that mistake again.” (01:31-02:04)
  • “Hassett...checks a number of boxes that are going to be important to Trump… he’s not going to spook bond markets, that he’s some kind of unqualified partisan.” (02:04-02:23)

• What Kind of Fed Chair Will Hassett Be?
  Timoros notes a shift in Hassett’s rhetoric:

  • Previously asserted Fed independence, but this year has been more critical, claiming the Fed has become partisan.
  • Raising market questions: “What will Kevin Hassett actually be like if he’s in this job?” (02:51-03:36)

2. Rollback of Fuel Economy Standards

• Trump’s Regulatory Changes:
  Announces a rollback of car fuel economy standards from the Biden-era requirement of 50+ mpg down to 34.5 mpg by model year 2031.
  • Trump: “But we’re protecting our autoworkers and we’re making it easier for every family to afford high quality cars.” (04:20)
  • Auto and oil industries approve; environmental groups criticize the move for likely increasing gas demand and prices. (04:26)

3. Market Update

• Stock & Commodity Trends:

  • Dow closes up almost 1%.
  • Copper prices reach record highs due to global supply fears.
  • Natural gas futures hit a three-year high anticipating colder weather. (04:42-05:05)

• Corporate News:

  • Macy’s posts best comparable sales quarter in three years and upgrades its forecast.
  • Delta Airlines reveals $200 million lost from government shutdown, but bookings have rebounded. (05:05-05:50)

4. Pentagon “Signalgate” & Drone Program Expansion

• Signalgate Findings:
  Pentagon’s internal watchdog finds Defense Secretary Pete Hegseth used Signal app to share sensitive info about U.S. missions, violating department regulations.

  • The info “would have posed a risk to troops and the mission if it had been intercepted... [but] Hegseth has the authority to declassify information, suggesting no law was broken.” (06:29-07:29)
  • Defense Spokesman: ...a “total exoneration of Hegseth.” (07:29)
  • Unclassified version of the report to be released soon.

• U.S. Drone Program Adopts Iranian Model:
  Pentagon set to deploy a new low-cost “kamikaze drone,” modeled after Iran’s Shahed drones.

  • Defense Secretary Hegseth: “We now find ourselves in a new era, an era of cheap, disposable battlefield drones...” (08:08)

• Expert Analysis:
  Lara Seligman (WSJ national security reporter) explains why the U.S. is copying Iran’s design:

  • Iranian drones have been effective in Middle East conflicts, damaging U.S. interests and allies.

  • “...has actually been used to great effect by Iran... against commercial vessels in the Red Sea and by the Russians to great effect in Ukraine.” (08:36)

  • Cost vs. Effectiveness:

    • Each new U.S. drone costs around $35,000, compared to $16 million for existing MQ-9 Reaper drones.
    • “The idea is that they're one way attack drones, which means we can buy a lot of them, we can expend a lot of them, we can use them quickly.” (09:28)

  • Capabilities:

    • Fully autonomous, flexible launch options, and expected to be widely deployed by September 2026.
    • “The goal really is to have each army squad unit have one way attack drones by September 2026.” (09:56-10:36)

Notable Quotes & Memorable Moments

• President Trump, on his shortlist:

  • “I guess a potential Fed chair is here, too... He’s a respected person, that I can tell you. Thank you, Kevin.” (00:14)

• Nick Timoros, on Trump’s desire for loyalty:

  • “He picked Jay Powell eight years ago, and he’s been furious with his decision ever since because he thinks Powell hasn’t rewarded him with loyalty and he doesn’t want to make that mistake again.” (02:08)

• Nick Timoros, on investor uncertainty:

  • “I think the question is going to be, which Kevin do we get?...This year, he’s taken...a more menacing tone towards the Fed... He’s attacked the Fed as being partisan.” (02:51)

• President Trump, on easing car regulations:

  • “But we're protecting our autoworkers and we’re making it easier for every family to afford high quality cars.” (04:20)

• Defense Secretary Pete Hegseth, on U.S. drone strategy:

  • “We now find ourselves in a new era, an era of cheap, disposable battlefield drones. We cannot be left behind. We must invest in inexpensive unmanned platforms that have proved so effective.” (08:08)

• Lara Seligman, on drone adoption:

  • “...has actually been used to great effect by Iran in the Middle East. Two years ago, Iran sent a shahed drone to attack Tower 22...and it killed three American soldiers and injured dozens more.” (08:36)

Timestamps for Important Segments

• Trump hints at Kevin Hassett as Fed pick: 00:14
• White House cancels Fed interviews: 00:55
• Nick Timoros on reasons for Hassett's selection: 01:31-03:36
• Fuel economy standards rolled back: 03:43-04:26
• Market update & Macy’s/Delta news: 04:42-05:50
• Defense Secretary Hegseth Signal app controversy (“Signalgate”): 06:29-07:29
• Pentagon’s 'drone dominance' initiative: 08:08-10:36

Conclusion

This news-packed episode offers clear insight into the political calculations shaping the next Federal Reserve appointment, regulatory moves affecting the U.S. auto industry, and how defense readiness is evolving through new, inexpensive drone technology. Listeners gain an informed picture of critical transitions in the economy, the shifting landscape of regulatory policy, and military modernization—all with direct quotes and analysis from leading voices in journalism and public policy.