Reports leaked Wednesday that President Donald Trump was getting ready to fire the chairman of the Federal Reserve, Jerome Powell. The news caused markets to dip, but TACO, the popular Wall Street acronym that stands for Trump Always Chickens Out, appears to be the dish of the day, as the president denied he was going to fire Powell while speaking to reporters in the White House.
“He should have cut interest rates a long time ago. Europe has cut ’em 10 times in the short period of time, and we cut ’em none,” Trump said of Powell during a press conference with the crown prince of Bahrain, Salman bin Hamad Al Khalifa.
Trump said that high interest rates harmed people who were trying to buy a house, and then tried to claim President Joe Biden was the one who appointed Powell. “I was surprised he was appointed. I was surprised, frankly, that Biden put him in and extended him, but they did,” Trump said, before stating, “we’re not planning on doing anything,” apparently a reference to firing Powell.
Powell was nominated by Trump in November 2017 and was confirmed by the Senate in January 2018. The Fed chair’s term lasts four years, and Biden did indeed nominate Powell for a second term, though Trump tries to make it sound like he had nothing to do with Powell’s first appointment.
Trump went on to say that he would be able to make a change in about 8 months, when Powell’s second term is up. The current frontrunner to replace Powell is White House economics advisor Kevin Hassett, according to Bloomberg News, though other names include former central bank governor Kevin Warsh, Treasury Secretary Scott Bessent, and Fed governor Christopher Waller. Warsh is reportedly interested in cutting rates, though he’d previously worried about what that would do to inflation, according to Bloomberg.
“We’re doing great as a country. We have no inflation. Record stock market, record business, record everything. Everything’s a record now. We had the worst inflation in history under Biden. And now we have almost no inflation,” Trump said.
While Trump is correct about the stock market, that inflation part isn’t really true. Consumer prices rose 2.7% in June compared to a year ago, according to numbers released by the Labor Department on Tuesday. That’s up from an increase of 2.4% in May.
Trump was asked by reporters in the room who was at the top of his list for Fed chair, with names like Bessent and Warsh mentioned. The president took the opportunity to say that it’s an easy job, suggesting the only thing any Fed chair needed to accomplish was lowering interest rates.
“We have a lot of good people for that job. It’s not a tough job, to be honest. Assuming you’re smart, it’s not a tough job. If you’re a dummy, then I guess it’s a tough job. But it might be one of the easiest jobs I’ve ever seen,” Trump said.
The president went on about Powell’s renovations at the Federal Reserve that will cost about $2.5 billion. As the Associated Press notes, the renovation project has been underway since Trump’s first term, but Trump wants to make it sound like something both nefarious and new is happening that would be a pretext for firing Powell.
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