Markets Weekly Notes
Jan 26 – Feb 1 · 2026-W05
3 events this week
🧠 Feynman Takeaway
Kevin Warsh nominated as Fed Chair, Fed holds rates steady, 23/5 trading formally approved — the most consequential week of 2026 so far.
Fed Holds Rates at 3.5%-3.75%
In plain English
The January FOMC meeting held rates steady. Two dissenters wanted a cut, but the majority held firm. Powell said policy was not 'significantly restrictive' — signaling no imminent easing.
Analogy
The Fed is like a thermostat set to 3.5%. Some people want to turn it down. The Fed says 'no, this temperature is fine.' And anyone hoping for an immediate rate cut is told: don't hold your breath.
Why it matters
The 'higher for longer' narrative would persist until Kevin Warsh took over in May. His first FOMC meeting in June would shorten the statement and kill forward guidance entirely.
Trump Names Kevin Warsh as Fed Chair Nominee
In plain English
President Trump nominated Kevin Warsh to replace Jerome Powell as Fed Chair (Powell's term ended May 15, 2026). Warsh — a former Fed governor, Stanford economist, and Morgan Stanley M&A banker — was seen as an inflation hawk who might nevertheless be open to AI-driven productivity boosting growth.
Analogy
This is like a soccer team benching its veteran goalkeeper (Powell) two games before the championship and bringing in a younger, more aggressive player (Warsh). The team's defensive strategy is about to change fundamentally.
Why it matters
Warsh's appointment was the single most important monetary policy event of 2026. Markets spent the next 5 months guessing what he'd do.
23/5 Trading Formally Approved
In plain English
SEC formally approved NYSE Arca and Nasdaq's 23/5 trading proposals. The era of overnight equity trading in the US officially began. Market structure would never be the same.
Analogy
The NYSE has operated roughly 9:30 AM to 4 PM since 1792. That's 234 years of the same schedule. Now stocks can trade 23 hours a day. It's like your favorite coffee shop suddenly being open 23/5 after two centuries of 9-5.