On the eve of Wednesday's Fed decision, President Trump is once again bashing the Federal Reserve over its plans to raise interest rates at a time when markets are already in chaos and the "World is blowing up" thanks in part to the central bank's "Double-barreled blitz" of higher rates and tighter liquidity.
Instead of insinuating that Fed Chairman Jerome Powell is trying to undermine the administration, the president ticked off a reasonable list of factors that should give a truly "Data-dependent" Fed reason to reconsider.
Instead of moving ahead with more rate hikes, Trump said the Fed should "Take the Victory!" Trump said.
It is incredible that with a very strong dollar and virtually no inflation, the outside world blowing up around us, Paris is burning and China way down, the Fed is even considering yet another interest rate hike.
Trump's Monday tweet follows a widely discussed op-ed published by investor Stanley Druckenmiller and former Fed Governor Kevin Warsh, who became the latest establishment heretics to side with President Trump over the economic establishment by urging the Fed to stop raising interest rates - for now, at least - due to "Recent economic and market developments." The two authors wrote that the Fed should have stopped QE years ago before the easy money policies helped blow a massive asset-price bubble that could collapse as liquidity is withdrawn and borrowing costs are raised.
Accelerated Fed QT, in the absence of rate rises, would have been much less disruptive to the real economy.
Powell himself recently acknowledged that Trump might have a point by shifting his rhetoric to note that the Fed funds rate is just below the policy range, and the market is increasingly in Trump's camp - expects just 10bps of rate hike in 2019 and expects 10bps of rate cuts in 2020.
https://www.zerohedge.com/news/2018-12-17/trump-slams-fed-eve-rate-decision-incredible-fed-hiking-world-blowing
Instead of insinuating that Fed Chairman Jerome Powell is trying to undermine the administration, the president ticked off a reasonable list of factors that should give a truly "Data-dependent" Fed reason to reconsider.
Instead of moving ahead with more rate hikes, Trump said the Fed should "Take the Victory!" Trump said.
It is incredible that with a very strong dollar and virtually no inflation, the outside world blowing up around us, Paris is burning and China way down, the Fed is even considering yet another interest rate hike.
Trump's Monday tweet follows a widely discussed op-ed published by investor Stanley Druckenmiller and former Fed Governor Kevin Warsh, who became the latest establishment heretics to side with President Trump over the economic establishment by urging the Fed to stop raising interest rates - for now, at least - due to "Recent economic and market developments." The two authors wrote that the Fed should have stopped QE years ago before the easy money policies helped blow a massive asset-price bubble that could collapse as liquidity is withdrawn and borrowing costs are raised.
Accelerated Fed QT, in the absence of rate rises, would have been much less disruptive to the real economy.
Powell himself recently acknowledged that Trump might have a point by shifting his rhetoric to note that the Fed funds rate is just below the policy range, and the market is increasingly in Trump's camp - expects just 10bps of rate hike in 2019 and expects 10bps of rate cuts in 2020.
https://www.zerohedge.com/news/2018-12-17/trump-slams-fed-eve-rate-decision-incredible-fed-hiking-world-blowing
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