As Kevin Warsh's scheduled takeover as Federal Reserve Chair approaches, two major uncertainties in the narrative remain to be clarified. First, will Warsh firmly push for interest rate cuts, or is he a "dove" in disguise but a "hawk" in reality? Second, Warsh advocates for reducing the balance sheet, which, in principle, could push up long-term interest rates and potentially conflict with the U.S. Treasury's massive debt issuance needs. Will the liquidity benefits for financial assets consequently come to an end? Can Warsh translate his expressed views into actionable policies?

A former senior economist at the Fed and professor at Shanghai Advanced Institute of Finance, Shanghai Jiao Tong University, noted in an exclusive interview that while Warsh's ideas sound coherent, implementing them in practice is far more challenging than proposing them. "He faces at least two major difficulties: strong pushback from the financial sector and survival pressure on the U.S. Treasury," the professor explained. "Warsh's proposed direction is theoretically sound, but its execution will be a significant challenge. I believe the process will not only be gradual but extremely gradual."