Last week it seemed as though Kevin Hassett was the clear favorite to become the Federal Reserve chair.
Now it appears to be a head-to-head contest between him and Kevin Warsh.
In a WSJ interview on Friday, President Trump also shared his views on interest rates.
If Trump's brazen politicization of the Fed leads to abnormally low rates,
it may not be well-received by the bond and currency markets.
"Asked where he wants interest rates to be a year from now, Trump said, '1% and maybe lower than that.'
He said rate cuts would help the U.S. Treasury reduce the costs of financing $30 trillion in government debt.
'We should have the lowest rate in the world,' he said."
"'I won’t have anybody on the Federal Reserve that when you have good news,
that means you automatically raise interest rates through the roof in order to kill inflation,' Trump said.
'If you have lots of good news, they will do everything they can to stop it, because they’re so afraid of inflation.'"
https://www.msn.com/en-us/money/markets/trump-says-he-is-leaning-toward-warsh-or-hassett-to-lead-the-fed/ar-AA1Sfhhb
Comments
this ship didnt just sail, it sank dockside with trump 2.0
long letter online from d.demartino booth to FOMC . key excerpts :
"...Ten years ago, after leaving the Federal Reserve Bank of Dallas, I harnessed my energies to write ...a blueprint to
guide the 19 members of the FOMC to return the institution to its intended purpose – shepherding the U.S. dollar’s buying power and acting as lender of last resort in times of financial crises...
2026 is an election year. The Fed could easily be called upon in the next year to monetize any debt created to buy votes, to take the Fed funds rate back to the zero bound, and relaunch QE. ... Save a macroeconomic miracle, few sitting members of the FOMC advocate for what they will, no doubt, be prompted to do by the administration..."
sadly thinking that bessent can\will prevent this, booth naively quotes him at his word :
"...Central bank independence is fundamental to the economic success of the United States. The Fed must change course. Its standard monetary policy toolkit has become too complex to manage, with uncertain theoretical underpinnings and problematic economic consequences.."