Who is Stephen Miran (Capital Wave Report)Don't sleep on this nomination. It represents a possible systemic shift in how our central bank operates.
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Good morning: I'm staring at Stephen Miran's Fed nomination to the Fed… Bullish or bearish for bunker rentals? The same story comes again and again… Media outlets have no clue what to make of something that’s supposed to be dull. The simple headline goes "Trump nominates economist to Fed board." Yawn. Move along. Wrong. Stephen Miran is not your standard Fed technocrat. He spent real time in markets… most recently as a strategist at a major hedge fund. Then he came over to be the chair of the Council of Economic Advisers in 2025. He's been trading in a world that others merely model. And he represents a significant shakeup after more than thirty years: Traditional monetary policy (what most people don’t even know the Fed does)… is a pretty simple set of tasks. This isn’t South Park, where central bankers are drinking martinis and cutting the heads off chickens… But the outcomes sure are random… Today’s traditional Fed policies include:
Miran's view cuts straight through all of this… He’s more focused on the Dollar Curse… On the basic idea that the dollar is structurally overvalued because the world hoards dollar reserves. And it’s that overvaluation that’s been hollowing out U.S. industry and distorting trade. Simply put, this is known as a resource curse… (More on that here…) Fixing it requires policy that targets the dollar itself, not just the overnight rate… Their policies would include tariffs paired with currency moves that shift costs onto trading partners instead of U.S. households. He's not arguing over 25 bps. He's arguing the Fed and Treasury should operate inside a broader strategic-dollar framework. Monetary policy, trade policy, and national security… braided together. The Revolution Hiding in Plain SightHere's the part almost nobody is gaming out… Miran's short-term appointment would still put him inside the room for every rate call through January. And that seat makes him eligible for the only promotion that matters… Fed Chair in 2026. Powell's term as chair ends in May 2026; by law, the chair must be chosen from current governors. Miran could be in an audition. Although the Kalshi market (prediction markets) aren’t even pricing the man in… Christoper Waller is currently the favorite…
Might be a good time to throw a few dollars on Miran once his name pops up… Look at James Bullard - formerly a St. Louis Fed President - as well… Treasury Secretary Scott Bessent has already floated a "shadow chair" concept. This would be to install a forceful governor who articulates the White House's view even when the chair won't. If Powell resists, the administration wants a counter-Powell inside the building. And that’s what makes this so dramatic. Miran co-authored a detailed blueprint arguing that Fed "independence" has become a slogan that shields bad incentives and groupthink. His fix isn't to add more PhDs to the dot plot. He and his co-author Dan Katz at the Manhattan Institute want to rewire governance… including shorter terms, greater presidential accountability on the Board, and more weight for the regional Feds. So, fewer priests of academia… and more people who’ve traded all the alchemy… The Dollar… Choose Your WeaponMiran's was a part of economic policies that people have dubbed the "Mar-a-Lago Accord." Think Plaza Accord for the 2020s… It is a coordinated currency realignment that leaves the dollar less overvalued, paired with tariffs and security bargaining. The point isn't to torch the dollar; it's to rebalance the costs of reserve-currency status… away from U.S. factories and toward surplus nations that free-ride on access to the U.S. market and defense umbrella. The argument goes that tariffs can be disinflationary if they trigger offsetting currency moves. In that setup, foreign producers eat the cost, while the U.S. Treasury collects revenue. That's the opposite of the textbook story Wall Street has told for decades. And I’m not sure if it will work or not… I’m just pointing the camera because I’ve never seen it before… Now, the drama picks up… Already, two governors dissented at the last meeting. They pushed for a rate cut while the majority held. More dissents are coming if the data wobbles. Now, add Miran, a much louder, pro-tariff, dollar-management voice. This will create a new scrum, one with visible, market-moving splits on policy path, communication, and the role of the dollar. Miran represents the return of political economy (the best class I ever took). And I mean that in the most blunt way possible… It’s the view that money and power are inseparable and should serve explicit national aims. It’s a straight-up throwback to the 18th-century way of thinking about economics, political science, and sociology. He’s pushing for re-industrialization, supply-chain redundancy, and strategic autonomy. You’ll probably hear a bunch of people start becoming experts, everywhere, in Adam Smith and François Quesnay. But in a world where China runs mercantilist playbooks, Europe freeloads on U.S. defense, and OPEC moves prices at will, Miran's answer is simple. He wants to make the dollar a tool of statecraft… If that means louder fights inside the Fed and bigger accords between countries, and even higher term premiums in bond markets, so be it. The markets won’t like them. Markets want complacency. If investors believe the next chair will be an extension of the White House's strategy, they will demand more yield until the framework is clear. It’s a bold experiment though… In theory, higher Treasury yields could pull in foreign capital even as a less overvalued dollar boosts U.S. production. It's a re-pricing of the whole macro regime. But as we’ve seen, foreign investors are less enthusiastic about U.S. debt… That’s why they’re buying up U.S. assets instead… I think that’s the better playbook for now… Keep a very close eye on moving averages. I expect that we’ll see the fireworks come 2026-27, and we could be facing another retread of repricing very similar to what happened in 2022… Now, let’s get to the market report…... Continue reading this post for free in the Substack app
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