Report: POTUS Trump considering firing his economy-wrecking Fed chairman

There has been so much fake news regarding the machinations and internal workings of the Trump White House so everytime we hear that ‘the president is thinking this’ or ‘the president is thinking that,’ we take it with a grain of salt.

However, reports that POTUS Trump is considering replacing Federal Reserve Chairman Jerome Powell seem credible if only because we believe the president is awfully protective of the booming economy he and Republican tax cutters have built.

And Powell’s continued rate hikes over the past quarter, with more pledged for next year, have had a devastating impact on the markets and the economy as a whole.

POTUS and Powell have been dueling over those rate hikes for weeks after four increases this year, including a quarter-point increase to 2.5 percent this week. Also, the president has publicly criticized the hikes.

Now, Bloomberg is reporting that sources familiar with the complaints say Trump has been talking privately this week about firing Powell, just a week after Defense Secretary James Mattis offered his resignation.

POTUS named Powell to head the Fed and he has said in recent months he wouldn’t fire him. But that opinion could be changing after the worst December for the markets in years.

Bloomberg noted, somewhat conflictingly:

Any attempt by Trump to push out Powell would have potentially devastating ripple effects across financial markets, undermining investors’ confidence in the central bank’s ability to shepherd the economy without political interference. It would come as markets have plummeted in recent weeks, with the major stock indexes already down sharply for the year.

If the markets are already tanking — some say because of the rate hikes — why would they become roiled again if the man who was responsible for raising rates were replaced?

That seems logical, but the thinking is that the Fed chairman, though he or she is appointed by the president, is nevertheless immune from the political whims of the chief executive, so an abrupt dismissal would be read by the markets as turbulence and uncertainty.

As to whether a president has the authority to fire a Fed chief, the Federal Reserve Act is ambiguous: Fed chiefs are also federal reserve governors and can only be removed “for cause” — whatever that means.

One spot of good news, Fox Business reports: Analysts don’t see the partial government shutdown as negatively affecting the markets:

According to Moody’s vice president and senior credit officer William Foster, a brief shutdown of the government would cause “minimal disruption” to the economy, and wouldn’t have a material impact on the United States’ sovereign credit profile.

“While a shutdown would halt federal discretionary spending, spending on mandatory programs such as Social Security and other social programs would continue, as would principal and interest payments on U.S. government debt,” he said in a statement.

Leave a Reply

1 Comment threads
0 Thread replies
Most reacted comment
Hottest comment thread

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Notify of

We need to rid our country of the Fed!

%d bloggers like this: