What Happens When the Fed Put Disappears?

by Chris Pulver | Jun 30, 2026

I’ve been thinking a lot lately about what’s brewing beneath the surface of this market — and it’s not just about the daily price action or whether we’re due for a pullback.

It’s about something much bigger: the incoming Fed chair Kevin Warsh and what his leadership could mean for the market’s safety net. Because here’s what I’m watching closely…

I think the Fed put is now much lower than what it was under former Chair Jerome Powell during the Biden administration or even recently under Trump.

That’s a massive shift in market dynamics and it’s one of the biggest macro risks we’re facing right now.

The Fed Chair Transition Nobody’s Talking About

Let me be clear about something: Warsh might look like a dove in hawk’s clothing, but I think he could actually be firm as a hawk or firmly neutral — someone who refuses to be pinned down as either dovish or hawkish. That kind of strategic ambiguity is exactly what markets tend to test, especially during the early months of a new Fed regime.

Historically, new Fed chairs often face a period where markets push boundaries to see where the real limits are. With Warsh stepping into the role, I expect that pattern not only to repeat but to intensify. His first press conference and the first six months will be critical and every word he says — or doesn’t say — will be parsed in real time.

And that’s where the real risk emerges. Warsh is not the type of Fed chair who’s going to step in and put a backstop under the market right away. I could see a scenario where the market is down 20% and he simply says that’s unfortunate but takes no action.

That perceived inaction alone can set off waves of volatility as investors try to recalibrate their expectations around what the Fed will tolerate.

What This Means for How You Navigate Risk

The market’s going to be extremely sensitive to anything Warsh communicates, and the lack of an immediate safety net means we could see sharper, deeper corrections before buyers step back in. When the market realizes that the automatic cushioning we’ve grown used to isn’t guaranteed anymore, volatility tends to expand.

Layer on the broader environment — especially the midterm elections creating political uncertainty at the exact same time a new Fed chair takes the helm — and you have overlapping risk regimes that amplify one another.

New leadership at the Fed, heightened political stakes and shifting macro conditions all collide to create an environment where price swings become more exaggerated and trend reversals happen faster.

What does that mean practically? It means corrections could run deeper before any policy response materializes. It means the market might not find a floor as quickly as it has in recent years. And it means we need to be more tactical about how we manage risk and position for volatility.

I’m not saying this to create fear — I’m saying it because understanding the macro backdrop is crucial for making smart trading decisions. The midterm elections and the new Fed regime under Warsh represent some of the biggest unknowns for markets right now, and I want to make sure you’re thinking about these factors as you plan your positioning.

The Fed chair transition might not dominate headlines every day, but it’s absolutely one of those slow-moving macro shifts that can reshape market behavior in profound ways. Stay alert, stay flexible and be ready for the market to test these new boundaries.

I’ll see you in the markets.

Chris Pulver
Chris Pulver Trading

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