Stay cool, man. It’s not that bad…
The President started the day by roasting his Federal Reserve chairman, Jerome Powell:
That’s because Powell made a public appearance, and while he did say the Fed is moving to “sustain the expansion” in the U.S. economy, which would normally be interpreted to mean lower interest rates ahead, he didn’t say what Trump wanted: that he would cut interest rates by 100 basis points, as the President has been demanding. 100 basis points is one full percent, which is something you do in an emergency. So is it?
Of course, Powell didn’t hire himself. He was hired by Trump (but since the Federal Reserve is designed to operate mostly outside the influence of the President and, politics in general, he can’t easily fire him until his term is up, which wouldn’t come until Trump’s second term, if he’s re-elected). Trump didn’t have to hire Powell, he could’ve just kept on Janet Yellen as Fed Chair, but at the time he commented: “you like to make your own mark”. So one of our friends suggested if he really feels Powell is an irredeemable disaster, it would be far more accurate for Trump to post this:
(OK that’s juvenile but it rings true and again emphasizes that Trump never takes responsibility for anything that he doesn’t like happens under his watch, and anyone who disagrees with him is an instant “enemy”).
Powell, in his own understated Fed Chair-like way, gave as good as he got: emphasizing that we’re in (literally) uncharted territory because things like Trump’s trade wars are making it virtually impossible to use tried-and-true economic models.
“While monetary policy is a powerful tool that works to support consumer spending, business investment, and public confidence, and public confidence, it cannot provide a settled rule book for international trade.”
Here’s a link to the full transcript of Powell’s speech, which is far more interesting and less cryptic than these things tend to be. (And also we wanted you to be able to judge…