The Julia La Roche Show #314 Chris Whalen: The Case For Kevin Hassett For Fed Chair, No Crisis On Horizon & Why Rate Cuts Are Coming
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Dec 6, 2025 
Chris Whalen, chairman of Whalen Global Advisors and author of The Institutional Risk Analyst, discusses the Federal Reserve's political influences on rate cuts, especially ahead of midterm elections. He shares insights on the possible appointment of Kevin Hassett as Fed Chair and analyzes the upcoming FOMC meeting. Whalen explores commercial real estate challenges and the outdated nature of the Fed's 2% inflation target. He also describes the K-shaped economy, highlighting the divide in recovery experiences among consumers and investors.
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Fed Independence Is A Myth
- The Fed is inherently political because presidents appoint governors and Congress authorizes the Fed.
- Chris Whalen argues the Fed functions as the Treasury's alter ego and cannot be truly independent.
Politics Will Drive Rate Cuts
- Political pressures will push the Fed to lower mortgage rates ahead of the midterms to help the incumbent party.
- Whalen expects cautious, incremental cuts to balance credibility and political demands.
Monitor Lenders For Early Rate Moves
- Watch mortgage lenders' pricing as they anticipate Fed cuts because competition can push mortgage rates down quickly.
- Expect refinance volume to surge if rates fall a quarter or half point, boosting lenders and the housing market.
