Warsh Credibility Crisis Sparks Gold and Crypto Buying Spree as Bessent's Plan Backfires

Fed chair Kevin Warsh's credibility has been called into question due to his acceptance of the role despite the White House's pressure campaign against Jerome Powell and Lisa Cook.

This criticism was further exacerbated by Scott Bessent's attempt to bully the bond market with a threat of upsized Treasury buybacks, which backfired and garnered even more criticism.

Gold and crypto funds saw significant inflows in the week following Bessent's announcement, taking in $10.5 billion between them, with $7.3 billion going to gold and $3.2 billion to crypto.

Warsh is expected to address these issues at Jackson Hole, where success would be a bull flattener according to BofA's Michael Hartnett.