Kevin Warsh, Gov. Wes Moore, & Exxon’s Darren Woods 1/30/26

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0:35Access new online courses, insightful webcasts, articles, engaging videos, and more. All curated just for traders. Plus, guided learning paths with content designed to fit your unique interests. And no sifting to find exactly what you need, so you can spend your time learning to trade brilliantly. Learn more at schwab.com slash trading. Bring in show music, please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod. President Trump saying that he has picked Kevin Warsh. Finally, the president's pick for new Federal Reserve chair. CNBC's Steve Leisman helps break down the news. Warsh has criticized staff.

1:15He's criticized the PhDs, criticized the elite running policy. And he also has said that policy has been favoring the wealthy rather than people. And I think rightly so when it comes to criticizing, by the way, the Fed's actions during the pandemic. And ExxonMobil posting a strong financial quarter, even though oil prices are low and supply is high. Exxon Chief Darren Woods joins us. The markets are well supplied. So you've got, I think, a comfortable supply of oil, which is why we haven't seen a lot of volatility in oil with all the geopolitical dynamics. Plus, the future of the Democratic Party with Maryland's Governor Wes Moore.

1:53Why he's focused on what works rather than what's partisan. Baby bonds and these type of structures are things that I have advocated for for years. I think it's one of the more effective things that you can do to actually impact the issue of childhood poverty, which is the reason why I ran for governor in the first place. It's Friday, January 30th, the last trading day of the longest month ever. Squawk Pod begins right now. Stand Becky by in 3, 2, 1. Cue it, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC. We're live from the NASDAQ market site in Times Square. I'm Becky Quick along with Joe Kernan.

2:32Andrew is out today. Welcome back. Thank you. Can we? You look tan. Can we go back to, yeah, it's Windburn. Back to Davos? It's warmer there? Yeah. I can read your mind. We've been doing this for so long. Yeah. No, this is Windburn. This is Windburn. I played golf at a place where, you know, there's a course out in California where it's spyglass. Every hole is uphill. Oh, yeah. At this course, that beautiful, fantastic course down in Florida, wind in my face every hole. May the wind be always at the back. No, it wasn't. And, you know, my swing is in general just smooth as silk. And, you know, with that 30-mile-an-hour wind in my face, it's really something to behold.

3:15So you got a really low score, is what you're trying to tell me? Or not? No. No, it's scary. It makes me worry about Pebble Beach and people watching. Oh, that's coming up in a couple of weeks. Yeah, it's coming up. And people watching and everything else. Joining us right now on set to talk about affordability, the energy grid, and much more is Maryland Governor Wes Moore. Governor, it is great to see you this morning. Great to be back with you. Thank you. Thank you for coming in. My pleasure. My pleasure. I guess front and center affordability issues. That's been something we've spoken with you about in the past.

3:47It seems to be resonating through both political parties because it is something that hits so close to home for so many Americans right now. Where do we stand on the affordability issue? Do you think things are going to be better or worse in 2026? Well, and it's also important to remember that this is not a new issue. I mean, when I ran in 2022, you know, the issue that we talked about, it's about creating pathways for work, wages, wealth. Right. That's essentially affordability. Right. It's making sure that people can find good jobs that can pay them fair wages and people have a chance to own more than they owe.

4:20That's essentially all people are asking for. And so even if you look at the policies that we have laid out and the things that we are really prioritizing for this year, it's things like going after price manipulation, where you have large corporations when people walk into grocery stores and their data is being used against them to adjust prices. That we're going after things like housing, where I'm probably one of the most bullish governors in this country on increasing housing inventory, because if you increase inventory, you're going to, by an essence, help to drop costs. That we are focusing on things like energy, where I want to have more energy options.

4:54I want to invest in nuclear and solar and additional nuclear options where I believe in an all of the above approach when it comes to energy, because that will help to drive down costs. And so I do think this is an issue now, but also I don't think this is a new issue for many people. It's not a new issue. And let's be honest. This came from the huge increase in inflation that we saw post-COVID or during COVID and then post-COVID. Absolutely. started in the in the biden administration it was really strong and it that inflation has tamped down but prices haven't come down and so americans are still feeling this pinch but they are and i and i think we're also seeing is you have that combination of inflation and now rising unemployment so you're having that those stagflation pressures the wages are rising at least finally we are we're finally watching watching wages rise but we're not watching wages rise to the same extent as prices, right?

5:45And that's the thing I think people feel. Their real wages have been rising. Correct. But that means that it's faster than inflation just by definition. Than the old inflation. Right. Than the old inflation. But I think the challenge also becomes this, is that if we're watching unemployment also rise, you can raise wages. And for people who have work, that's great. But we're watching more and more people who now no longer have work or at least steady type of employment. The Fed, you know, in most recent things, said the risk of a real weakness in the labor market has subsided. And we're still basically at full employment.

6:20We are. What is it? 4.5? 4.6? That's exactly right. And honestly, listen, if you look at the state of Maryland, when I was first inaugurated as governor, we were ranked 43rd in the country in unemployment. We have taken a greater hit of federal employees being fired than anyone else. I mean, we've now had over 25 ,000 federal employees fired who are Marylanders, just in Maryland alone, more than any other state in this country. But because we've seen private sector employment kick up and because we've been really creative about ways to support our federal workers, we've actually had an unemployment rate that's still significantly lower than the national average.

6:53Look, this is an issue that both political parties are trying to capitalize on. They say the word affordability. They say the words trying to make it easier for Americans. but they both have pretty different ideas, at least if you're looking at the national level of these politicians who are talking about how to bring some of those ideas down. Here in New York City, Zora Mandani has made a lot of headlines this week talking about how he thinks the wealthiest individuals and the biggest corporations are going to have to understand that their relationship with the city is going to have to change, that they will be paying more to offer more services to those who are at the bottom end of that.

7:26I don't think that's necessarily the same school of thought that you come at with some of these issues. Yeah, I mean, I just introduced my most recent budget last week. And for the fourth year in a row, I did something that no one in Washington can do, which is actually present a balanced budget. You have to. Yeah, no, no, it's fair. But we print a balanced budget that does not raise taxes or fees on the people of the state of Maryland. That still keeps a very healthy 8 % within our ready day fund that actually significantly cuts the structural deficit that Maryland had, that I inherited when I first became the governor.

7:58And if you look at what we did last year, we actually did tax reforms where, but the tax forms we did was actually giving the middle class a tax cut, military veterans a tax cut. And we asked those who were doing well to invest a little bit more. But when I'm talking a little bit more for a person who's making over$750 ,000 a year, their increase was about$1 ,400. And so we think that was a smart way of being able to say we are going to make investments in our public schools. We're going to make investments in law enforcement. And we've seen the results of those types of investments already. Wes, do you wish Democrats had listened when these Trump accounts were proposed?

8:39Because that was proposed in the Biden administration. They had this idea to do it. And why do you think that went nowhere? And why isn't it getting more bipartisan praise for the potential to have every child participating in what we do so well here in this country? And that's create wealth and capitalism. The truth is that baby bonds and these type of structures are things that I have advocated for for years. I think it's one of the more effective things that you can do to actually impact the issue of childhood poverty, which is the reason why I ran for governor in the first place. But then you get some billionaires that step up and match things, and maybe they're not all, you know, headed, you know, straight to hell when they die.

9:23Maybe some of them are. Yeah. Well, no, and listen, and I believe in public private partnerships. If you look at the work that we're doing in Maryland, we actually have, you know, the most aggressive push towards ending child poverty through our Enough Act. And Enough is actually an acronym that stands for engaging neighborhoods, organizations, unions, governments and households. Wow. Where it's actually it is pretty good. But it's actually focusing on how do we come up with a public-private type of partnership to be able to use data to understand what were the areas in our communities, urban, rural, and suburban, that have been most inflicted by this issue of concentrated and generational childhood poverty.

9:58That's the kind of smart initiative that I think can work. But I do think that these accounts are something that can actually work, and people should be honest about that. Right. What are you, a moderate? but what i i'm just trying to figure out with your party where where you come down uh do you want more government do you think that's where the solutions are you think that less government the private sector is is where it is are you ever watching some of your co-democrats whatever they're called chris murphy someone like that you ever watching them where you go i don't know there's someone in a squad or you're just like you know you're at a loss for words on how to to react to where the geographic center of that party is right now?

10:40Well, you know, it's funny, Joe, because when I, because again, I had never run for office for my life. I remember. When I ran for governor. It doesn't mean you weren't on our show. It's true. I was on for years. For 15 years you've been coming. When I was running Robin Hood. Long before Robin Hood. Correct. That's exactly right. But I remember people were asking me, they'd say like, so where are you? And they're like, so. I ask you again, because I'm still. Yeah. Because I want to hear, I'm hopeful. Yeah. I'm hopeful you're going to give me an answer that I would like. So you know where I am?

11:09So, like, for example, when people said, well, we're going to deal with the issue of violence, and they said, well, are you pro-police or are you pro-community? And I said, I'm not choosing. And so what we've done in Maryland, I've made the largest investments in law enforcement and local law enforcement in our state's history. But you know what I've also done? Made investments in community groups and community violence intervention groups. And I've worked with both the mayor, the state's attorney, and the public defender that we've invested in technology and said if someone commits a violent crime particularly with a firearm i want him in handcuffs in 24 hours and we've also invested and said making sure that maryland is one of the only states that actually invests in the u.s attorney out of balance sheet and what have been the results maryland has had the fastest drop in violent crime anywhere in the united states of america over the past two years violent crime is down nearly 50 percent since i put my hand on the bible and was inaugurated because you could you could stake out a whole new territory in the Democratic Party.

12:03I don't do the are you this or are you that. I'm like, what makes sense? Help us pigeonhole you. Help us pigeonhole you. You can I just am thinking about, let's talk. I can help you. I can just give you some friendly advice on how to approach it. Because, man, I think the country's looking for there will be a post-Trump United States obviously. And I just don't think it's going to be quite as polarized as it is. But, you know, it's hard to find a candidate that appeals to anyone. It's like there's the what is it? The Venn diagram. The Venn diagram is like this right now. Yeah. It's nice to find some.

12:50And it could be. Right. It doesn't have to be. But honestly, I think that's why I love being a governor because as a governor you don't get a chance to just you know rail you know I don't you know that's all they do well and that's the thing is as a governor my job is not just to push back right my job is to push forward and my job is actually what is an alternative but actually look like and so when we say things like I believe in economic growth and economic development if you look at you know if you look at the the state of Maryland uh you know just in these past months we've seen how AstraZeneca has made the largest private sector investment in the history of the state of Maryland.

13:25It's going to support about 2 ,600 jobs that you've seen how Samsung Biologics is making their first investment in the United States. And where are they making it? In the state of Maryland. Are these all things that you have done? Oh, absolutely. CEOs basically one-on-one to say, I have been very clear. When I go to other cities, I'm bringing three jobs back. I'm bringing three businesses back with me. I am very, very aggressive and very competitive. And people know that, that we believe in economic growth, particularly when we're trying to diversify our economy off of off of Washington DC but I can say that I'm very pro-business but you know what I also did I made sure we raised the minimum wage you know I made sure that we're protecting our workers we did procurement reform to actually support more more minority owned businesses and women owned businesses and veteran owned businesses and we also did things like regulatory and permitting reform and making it easier for businesses to grow so I so I guess you know so the answer is where do you fall is I just like getting things done and I don't like falling into the ideological boxes.

14:23Governor Moore, thank you. I have the feeling we'll see you again soon, Wes. Yes, we will. I could have said, if you were a tree, what kind of tree would you be? That was a famous Barbara Walters question. So I just said, what are... What would you be? I want to be like an oak or something like that. Tall, firm. Steady. Right. That's what I want to be. Sure I am. Cheese will be next. Coming up on Squawk Pod, the winning Kevin. Kevin Warsh, officially President Trump's pick for next Federal Reserve chair. Steve Leisman joins the team with his analysis. Can't we just say for Fed watchers that had hair that was on fire, that the worst did not come to pass?

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16:46You're listening to Squawk Pod from CNBC. And we had breaking news this morning in our TV broadcast. Check it out. Up and Becky, Q. All right. It is official, the breaking news that we've all been waiting for. It is now out on Truth Social. President Trump saying that he has picked Kevin Warsh as his choice for the next chairman of the FOMC. we will next chairman of the Fed we will continue to get some of these numbers up I have some of this information up it is literally just hitting but this is what we've been talking about since last night really the news was first out kind of been reported in several different outlets that President Trump had honed in on his choice he said that himself have you seen the actual no I haven't I got it because he's really got a lot that he's saying here we should probably go Is that all we're gonna say?

17:38Go ahead and read what you've got. Kevin currently serves as the Shepherd Family Distinguished Visiting Fellows in Economics at the Hoover Institution, lecturer at Stanford Graduate School of Business. He's a partner of Stan Druckenmiller at Duquesne Family Office, LLC. He received an AB from Stanford. Guess he couldn't get in anywhere else. and a JD, kidding, from Harvard Law. Also, he has conducted extensive research in the field of economics and finance, issued an independent report to the Bank of England proposing reforms and the conduct of monetary policy in the UK. Wow, the president went wild here with all this.

18:21Parliament adopted the report's recommendations. He became the youngest Fed governor ever at 35 and is a member of the Board of Governors of the Federal Reserve from 2006 until 2011 as the federal representative to the group of 20, G20 as the board's emissary to the merging and advanced economies in Asia. This is really long. In addition, he was administrative governor, managing and overseeing the board's operations, personnel, and financial performance. And prior to his appointment to the Fed from 2000 to 2002 to 2006, He served as special assistant to the president for economic policy and executive secretary of the White House National Economic Council.

19:07Previously, Kevin was a member of mergers and acquisitions department at Morgan Stanley, serving as vice president as executive director. I've known and here's this is the last and maybe most salient thing here. I have known Kevin for a long period of time. I have no doubt that he will go down as one of the great Fed chairmen, maybe the best. On top of everything else, he is central casting. And he will never let you down. Congratulations, Kevin, President Donald Trump. He's a married guy, but I can just tell you one funny anecdote. I don't think he cared for it. I was at lunch with him at Michael's and a very attractive woman came over after he had gone to death and said, would you give that gentleman my car?

20:01Are you serious? Yes. And he's all dapper and decked out. Did you say no? I don't know what I said at that point. Go away. What I said was, I go, what? I'm sitting right here. I'm sitting right here. What am I? And I guess I was chopped liver. Let's get to our senior economics reporter, Steve Leesman. That never happened to me, Steve. Never happened in college. Never happened in—no one ever came up and gave me a card. Yes, Joe. Well, the president, as you just said, announcing moments ago that former Fed Governor Kevin Warsh will be his pick for nominee, that concludes a very—a months-long process.

20:44I believe it began back in the summertime. There is a picture of Kevin Warsh. He was, as you said, a Duquesne family office partner going back to 2011, working with famed investor Stanley Druckenmiller, governor from 2006, 2011, and a special assistant to George Bush in 2002 and 2008. He's been a sharp critic, as you know, Joe, of the Fed and Powell, blames them for the pandemic inflation. There you go. And he says the balance sheet can be, quote, reduced significantly. That's one of the concerns out there in the market. But he has said to do that over time and it would allow for rates to be reduced further.

21:26He has praised the pro-growth policies of championed by President Trump and said the Fed should abandon the dogma that growth creates inflation. I'm not sure the Fed has that dogma, but he says the Fed should abandon it. He supported the initial QE purchases of the Fed in the great financial crisis. Then he broke with Bernanke over subsequent QE purchases, in part because of his concern over inflation. That inflation didn't appear, and he's been criticized for that, his concern over inflation, one of the reasons why people think he's somewhat hawkish. He further argued that QE encouraged Congress to spend leading to massive deficits out there.

22:06He thinks the Fed's responsible for that. Now, on Fed independence, Warsh told us in July, quote, I've strongly believed for 20 years and history tells us that independent conduct of monetary policy is essential. But Warsh has said repeatedly the Fed will secure that independence by reducing its footprint in the economy, balance sheet, and its political profile. That's what makes some on Wall Street a little bit wary, that Worsh will be less likely to come to the market's rescue in a crisis. Or if it does, that he will withdraw the support far more quickly than it has in the past. It's kind of old school thinking.

22:42We're going to talk to Rafael Bosco at the United Federal Reserve about this and other issues. But, Joe, it's kind of like an old school idea of central banking, going back to Badgett in the 19th century, that the Fed should be the provider of liquidity, a banker of last resort, but not go further than that. Yeah, over the years, we've seen so many op-eds from Kevin Warsh in the journal arguing different points. And I think, you know, he maybe sometimes great minds think alike. I know he and Stan Druckenmiller obviously discuss a lot of these issues. and he used the words regime change in a way that, it was hard to really understand exactly what he mean, but if you talk about regime change at the Fed, there's a lot of things that you have a problem with other than just who the current Fed chair is.

23:35It's sort of a systemic issue that I think he has, about transparency as well. Every waking thought coming from the Fed and dot plots and all those things. I think he'd like to change that a little bit too, Steve, right? I think that's right. You know, some of the things that Warsh has said make a lot of sense. And some people puzzle over some of these things, I have to say. When I talk to other people who are, I guess, maybe part of the current regime, they're a little puzzled by some of the comments that Warsh makes. And there's some questions about exactly what he'll do. I mean, what he has is this notion, and this is out there as a conservative critique, I guess, right now.

24:17Maybe it's more from the Trump side than it is the conservative side, that if growth is high, that the Fed raises rates. That's not actually accurate. The Fed raises rates, looks at growth as relative to potential and says there's a risk there of inflation. But it's really hard to find a situation where the Fed has really cut off growth too dramatically by raising rates in the face of strong growth that wasn't accompanied by inflation. We think about that every single time. It's the good news, bad news. We always talk about it. Uh-oh. Something comes out. It's either a good jobs number or a hot GDP number.

24:56It doesn't have to be inflation. And we'll say, uh-oh, the market's down because now they think that future rate cuts are in jeopardy because the economy's running hot. That's the whole nature of what we're thinking. But the weird thing, Joe, the weird thing is— But we think about that all the time. And maybe it's not true. Absolutely right. And we don't— Absolutely right. Why should we always think, uh-oh, we need to slow the economy down? If there's productivity and there's no inflation, it's like, let it ride, baby. And actually, Besson has said they want someone like that. The president is in a bit like Greenspan back in the 90s.

25:31What about a market melt-up? That's the concern. Wait, Joe, what is the actual, what were the actual instances of that? And hasn't the conservative critique of the Fed been that the Fed is too easy? That has been the running critique of the Federal Reserve for decades. And when I think back on the situations that you were talking about, you're right. The market does get concerned about that. But the real actions of the Fed, as at least critiqued from the right, have been that the Fed is too easy. Think about, you know, it raised rates in 99. Was that wrong? That was, you know, and he let him ride in 96.

26:06Go back through the decades, Joe, and it's hard to find a case where the Fed said, well, because of high growth, we're raising rates. It does so when inflation ticks up. Steve, let me ask you this. because Kevin Warsh has been so critical of the Fed for so long, I know there are some people inside the Federal Reserve right now who are not huge fans. What's the relationship going to be like with him coming in? And I ask that specifically because the chairman of the Fed is not necessarily handed a mandate to be able to determine how the FOMC will vote on any given day. will he be able to come in and build a consensus to say here's what I think and that's why I'm going to convince the rest of you that this is what we're doing you know Becky what you're just pointed to is essentially the Federal Reserve chair's job right Congress creates this Federal Reserve that has representatives from districts all through the country and I'll get to the staff in a second that's a separate order because Warsh has criticized staff.

27:13He's criticized the PhDs, criticized the elite running policy. And he also has said that policy has been favoring the wealthy rather than people. And I think rightly so when it comes to criticizing, by the way, the Fed's actions during the pandemic. But he's going to have to put a consensus together. And by the way, that's one of the things that, at least in our Fed survey, is something that makes people a little less concerned about whoever this chair is going to be, is that the committee is still there. He still needs the committee. He has to work with them. Now, the Fed chair has a lot of sway over the committee, especially the board of governors typically.