As US President Donald Trump lays into Federal Reserve Chair, Jerome (Jay) Powell, with unprecedented (yes, there's the "u" word again!) rancour, it's worth bearing in mind the role that the Fed is actually filling in these heady days of the Trump administration.
Trump kvetches: "So far, I'm not even a little bit happy with my selection of Jay. Not even a little bit." Ouch! And: "I think that the Fed is way off-base with what they're doing ... I'm doing deals and I'm not being accommodated by the Fed". So much for respecting the division of economic powers, and allowing the Fed to operate independent of government influence, as past presidents have taken care to do. Care doesn't come into it with Trump.
It's exactly because of those "deals" that the Fed is doing why it is doing (gradually raising interest rates), in a desperate attempt to keep the ship afloat while Trump rocks it with gay abandon. Almost everything Trump is doing is guaranteed to lead to rampant inflation: impose tax cuts on an economy that is already running at full speed and creating full employment; run a huge and ever-increasing federal deficit; impose inflationary tariffs on a wide range of imports from major trading partners; even the very act of denouncing a Federal Reserve that is trying to keep a lid on things.
The Fed is only trying to rein in these inflationary forces as best it can, by raising interest taxes to stabilize growth and cool prices. That is its job. Always has been. Trump should be grateful (fat chance of that!)
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