Trump says he has no plans to replace Federal Reserve Chair Powell, attributing positive aspects of the economy to his administration.
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Donald Trump, our fearless leader, has declared that he won't boot Jerome Powell from his position as Federal Reserve chair before the man's term ends in 2026. But, as always, he didn't hold back, slamming Powell as a "stiff" and once again urging the Fed to lower interest rates.
Trump stood firm on his trade policies, arguing that they'd eventually make America great again, and blamed Joe Biden's policies for the first-quarter economic downturn. In a chat with Kristen Welker on "Meet the Press" on NBC News, Trump hinted that the Fed would eventually cave and slash rates.
"Well, he should lower them. And at some point, he will. He'd rather not because he’s not a fan of mine. You know, he just doesn't like me because I think he's a stiff," Trump said, echoing his distaste for the man running our central bank.
When asked if he'd remove Powell before his term ends, Trump shut down the rumors flat-out. "No, no, no. That was a total - why would I do that? I get to replace the person in another short period of time."
Financial markets took a dive last month when Trump doubled down on his attacks against Powell, fueling worries about the Fed's independence and spooking investors. Since then, however, Trump has toned it down a bit.
Trump's comments during the interview offered the clearest indication yet that he's keeping Powell in the game, which should calm the jittery global trading system.
On April 2, Trump imposed a 10% tariff on various countries, with higher rates for trade partners, and levied 25% tariffs on autos, steel, and aluminum, on Canada and Mexico, and a whopping 145% tariff on China.
Trump's conflicting statements on the economy have stirred up a whirlwind on Wall Street, with the most tumultuous weeks since the early days of the COVID pandemic.
When asked when the economy would be all his, Trump shrugged it off, saying, "It partially is right now." He insists that the good parts are the Trump economy, but the bad aspects are the Biden economy since, according to him, Joe Biden's done a terrible job.
Trump boasted about driving down energy and gasoline costs, and turning around the U.S. trade deficit, while glossing over critics' concerns about rising consumer prices due to the tariffs on China.
"I'm just saying they don't need to have 30 dolls," Trump said. "They can have three. They don't need to have 250 pencils. They can have five."
Trump's team is reportedly working on multiple trade deals to avoid higher tariffs, with the first deal set to be announced soon. During his talk with NBC News, Trump didn't rule out making some of the tariffs permanent.
"No, I wouldn't do that because if somebody thought they were going to come off the table, why would they build in the United States?” he justified, touting the billions of dollars in investments pledged by foreign and domestic companies.
Trump acknowledged that he'd been tough on China, essentially cutting off trade between the world's two biggest economies, but maintained that China now longed for an agreement.
"We’ve gone cold turkey," he said. "That means we’re not losing a trillion dollars ... because we're not doing business with them right now. And they want to make a deal. They want to make a deal very badly. We'll see how that all turns out, but it's got to be a fair deal."
Insights:
- Background: Initially supportive of Jerome Powell as Federal Reserve Chair in 2017, Trump's relationship with the central banker soured due to frequent public criticism over slow interest rate cuts.
- Market Impact: Trump's persistent attacks on Powell, threats of removal, and disparaging remarks challenged the Fed's independence and contributed to increased market volatility, worsening the global trading system.
- Potential Impacts: If some of the imposed tariffs become permanent, they could disrupt U.S. trade relations, potentially impacting both domestic and foreign companies alike.
- The stock-market experienced a decline last month due to Donald Trump's continued attacks against Federal Reserve Chair Jerome Powell, raising concerns about the Fed's independence and causing unease among investors.
- Trump's ongoingcriticism of Powell, including labeling him as a "stiff" and urging lower interest rates, have strained their relationship, with the Fed's independence being challenged.
- The sinister undertones of Trump's policies, such as the imposition of high tariffs, have contributed to a tumultuous period on Wall Street, with the most turbulent weeks since the initial days of the COVID pandemic.
- Moreover, the ongoing policy-and-legislation debates surrounding trade, specifically the long-term impacts of possible permanent tariffs, could potentially impact both domestic and foreign companies in the general-news context of the broader economic landscape.
