Episode summary
DOJ Drops Powell Probe, Smoothing Path for Warsh to Lead Fed | Bloomberg Businessweek
Bloomberg Businessweek Daily
· · 47 min · Hosts: Carol Massar, Tim Stenovec · Guests: Michael McKee, George Arison, Joshua Green, Ian King, Barbara Humpton
Summary
The episode centered on Washington headlines and their market implications, led by the Justice Department’s decision to end its probe into Federal Reserve renovation cost overruns. The hosts and Michael McKee argued that the move may ease the path for Kevin Warsh to get a hearing, but it does not fully clear Jerome Powell’s legal overhang because the Fed inspector general is still reviewing the project and Senator Tom Tillis has not dropped his objection. That uncertainty helped explain a small rally in Treasuries, with the two-year yield falling as traders speculated a Warsh-led Fed could be more willing to cut rates.
The discussion then shifted to Grindr CEO George Arison and the company’s growing Washington presence. Arison said Grindr is focusing on HIV testing and treatment, PEPFAR, and fertility and surrogacy issues, while working both sides of the aisle. He also described the company’s new premium “Edge” subscription tier as an AI-driven product aimed at power users, with pricing still being tested.
Later, Joshua Green discussed Republican Representative Thomas Massie, portraying him as a libertarian holdout who is one of the few Republicans willing to openly challenge Trump on spending, foreign policy, and the Epstein files. The segment framed Massie’s Kentucky primary as a test of Trump’s grip on the party.
Key takeaways
- Michael McKee said the Fed renovation case is still alive at the inspector general, so Kevin Warsh is not fully cleared yet.
- The two-year Treasury yield fell to 3.78% as traders bet a Warsh-led Fed could be more inclined to cut rates.
- George Arison said Grindr is using its DC presence to defend HIV funding and PEPFAR while expanding political engagement on both sides of the aisle.
- Joshua Green argued Thomas Massie’s May 19 primary will measure Trump’s power over Republican voters and donors.
- Massie’s stance on the Epstein files is part of a broader libertarian refusal to follow Trump on every issue.
Notable quotes
“Accordingly, I've directed my office to close our investigation as the IG undertakes this inquiry”
“This doesn't necessarily mean the investigation is over because it's going to the inspector general”
“the person who's going to make that decision is Senator Tom Tillis”
“We've got to use every tool in the tool belt right now”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. This is Bloomberg Business Week Daily, reporting from the magazine that helps global leaders stay ahead with insight on the people, companies, and trends shaping today's complex economy. Plus, global business, finance, and tech news as it happens.
The Bloomberg Business Week Daily podcast with Carol Masser and Tim Stenbec on Bloomberg Radio. Well, the Justice Department is ending a controversial investigation into building renovation cost overruns by the Fed, potentially clearing a path to confirmation for Kevin Wars. That is President Trump's pick to be the next chair of the central bank.
We did have US Attorney Janine Piro in a social media post earlier today. It's rather lengthy, but we want to highlight this part. Uh she says, "Accordingly, I've directed my office to close our investigation as the IG undertakes this inquiry.
Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so, which makes us wonder, wait, is it full steam ahead or not quite yet?"
All right. Well, maybe not. Maybe. We'll see. Bloomberg TV and radio international economics and policy correspondent Michael McKe joins us here in the Bloomberg Business Week studio. Is it full speed ahead for Kevin Walsh? — Well, — Sounds like not maybe.
First of all, uh the person who's going to make that decision is Senator Tom Tillis. We have not heard from him. Uh he's the one who has to drop his objection to the nomination moving forward. And the question is, is this enough? Because Carolyn Bessett, the White House press secretary, just a short time ago came out and said, "This doesn't necessarily mean the investigation is over because it's going to the inspector general."
Yeah. She said, she said it's just changing jurisdictions and you highlighted the line from Janine Piro.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- fed nomination
- interest-rate outlook
- treasury yields
- semiconductor earnings
- rare earths
Companies and tickers mentioned
- INTC
- TXN
- Intel
- Texas Instruments
- Grindr
- USA Rare Earth
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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