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Again, Trump Disses Federal Reserve Chairman Jay Powell

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Via Economic Policy Journal

Oh yeah, President Trump is a serious inflationist.

Over the course of two days, ABC News’ chief anchor George Stephanopoulos spent 30 hours with Trump, during that period Trump bashed Federal Reserve Board chairman Jay Powell for pushing interest rates too high.

From the transcript:

STEPHANOPOULOS: Any concern about the softening job numbers over the last couple months–

TRUMP: No, none– none– really none. If we pull off the trade deals, which I think I will, we have a lot of power. With respect to trade, we have a lot of power. And– we have great numbers. The companies are very strong. They’ve very liquid. Frankly, if we had a different person in the Federal Reserve that wouldn’t have raised interest rates so much, we would have been at least a point and a half higher. I mean, three–

STEPHANOPOULOS: He’s your pick.

TRUMP: –3.2 percent is good. He’s my pick. I agree. But, you know, we also have people in there that weren’t my pick. But he’s my pick. And– I disagree with him entirely. As you know, it’s independent.

STEPHANOPOULOS: I was going to ask you about that. What do you make of the critics who say it’s just inappropriate for you to be talking about the Fed chairman–

TRUMP: Well, I’m allowed to. And, y– you know, in the old days, they used to speak to the head of the Federal Reserve often. And it was a part– very much a part of the administration from the standpoint as they’d talk and they’d– (inaudible) settle. You have no idea how important it is. But I’m not happy with what he’s done. I’m not happy with the fact that they’ve done quantitative tightening. Now, he doesn’t make that decision himself. But I would think that the head of the Federal Reserve has quite a bit of power. No, I’m not happy. Now, if– if we–

STEPHANOPOULOS: Do you have any concern you’re putting him in a box–

TRUMP: Let– let me explain. Yes, I do. But I’m going to do it anyway because– I’ve waited long enough. If he did the interest rate increases half as much, if he didn’t do tightening– tightening means taking money out of the– out of the till so that people can’t use it for doing what they’re doing. We call it quantitative tightening. If he didn’t do tightening– if he did nothing or perhaps even loosened, we would be in my opinion, just an opinion, 10,000 points higher than already a very high number. You know, we’re– from the time I got elected, we’re about– we’re almost 50 percent up with the stock market. But if he didn’t do the tightening and if he didn’t do so much of an in– it’s okay to raise interest rates a little bit. But so much, it would have been– it would have been even better.

Of course, at the present time cutting interest rates can only happen by the Fed pumping more money into the system and distorting the economy even more. It also puts upward pressure on prices, which Trump indicated during the interview that he is not concerned about at this time.

TRUMP: And– and I’ll– and I’ll tell you something. What I don’t like is when you raise the interest rates, there’s no inflation– there’s virtually no inflation.

As I discuss in the EPJ Daily Alert, price inflation is gradually accelerating and the potential for it to spike to the upside is very strong at present.

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RW


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