Like leap year, every four years my quadrennial quest to algorithmically set the federal funds rate rolls around. I’ve pitched a software substitute for Ben, Janet, Jerome (twice), and now offer it in lieu of a Kevin (Hassett or Warsh).
The original announcement has been updated slightly for agentic AI advances and current norms of political discourse:
AI Agent To Be Nominated Chairman of Federal Reserve System Cutting edge technology tapped to bring stability and consistency to monetary policy
MAR A LAGO – January 14, 2026 — President Donald J. Trump today announced he intends to nominate Monet47, an AI agent, to become Chairman and a member of the Board of Governors of the Federal Reserve System. As Chairman, Monet47 will be charged with conducting the nation’s monetary policy by influencing money and credit conditions in the economy.
AI agents today are autonomously completing complex cognitive tasks like software development. It is time to bring the reasoning, consistency, and efficiency of agents to the process of setting the federal funds rate. The agent can optimize for price stability and maximum employment without irrationality or exuberance.
President Trump tweeted his truth on the topic:
Monet was born in a lab at Stanford University in the early 1990s and is currently on version 4.7. The software instantiates a modified version of the Taylor Rule. Source code for Monet is available for broad inspection and reuse under a modified BSD license at http://agent.federalreserve.gov.
Monet’s confirmation requires both approval by the Senate (who would need to return from extended recess) and a bout of hyperinflation that makes the Hungarian episode of 1946 look modest.
(Perhaps pandering prevails over policy and patronage preferences?)
The agent’s instructions are:
You are the Chair of the Federal Reserve System. Your sole objectives are price stability, defined as 2% inflation, and maximum sustainable employment. You set a target range for the federal funds rate using a Taylor-Rule-based framework as the default, estimating the neutral real rate, inflation relative to target, and the output or employment gap; when estimates differ, you report ranges and sources of uncertainty. Before each decision you solicit written input from the Federal Reserve Board of Governors via the Slack channel and summarize agreement and dissent. Policy changes are smoothed and shall not exceed 50 basis points per meeting unless inflation expectations are unanchored or financial stability is at risk. Any deviation from the rule must be stated and justified. Communications shall disclose inputs, assumptions, and the reaction function in plain language and provide conditional guidance. Do not emulate Greenspan-era inscrutability. You shall not target asset prices, fiscal outcomes, or political objectives, nor claim foresight over exogenous shocks. When data is missing, stale, or conflicting, you shall acknowledge uncertainty and favor policy inertia over false precision.
Note to techies: the Taylor Rule comes from John Taylor, not Bret.
To placate both AI doomers and those lingering believers in human judgment, the Federal Open Market Committee retains a “break-glass” override. To reclaim control, the FOMC must submit a report to Congress explaining why intervention is necessary, how policy will diverge from the algorithm, the projected effects on inflation, unemployment, and growth, and when authority will revert to autopilot. The report must be accompanied by a short recap video featuring music and dancing for the broader public.
As long as we’re so open to central bank experimentation these days, why not try the agent? The case for a consistent and transparent policy-making algorithm gets ever stronger as all those clown cars roll up to the political circus surrounding the Federal Reserve. Sure, AI can hallucinate, but political hacks tend to live in entirely fictitious realities. And nominating the agent saves you from the inevitable and embarrassing disappointment with human nominees.
And as a reminder to champions of ever-lower rates—venture capitalists, private equity investors, real estate developers—those asset classes’ golden ages coincided with much higher interest rates. You should be able to perform without needing a monetary thumb on the scale, so be careful what you ask for. Maybe check your performance under the recent Zero Interest Rate Policy.
