Trump Wants to Fire Federal Reserve Chairman Jerome Powell...

[MontyPython]

Trump today is apparently asking legislators if he should fire Powell "for cause" in light of the ongoing renovations to the 90+ year-old Fed Reserve buildings in DC. Trump alleges that Powell has mismanaged the project and, therefore, can be fired for cause.

How Trump could use an expensive Fed building renovation to oust Powell​

But Trump has made it abundantly clear that he's wanted to get rid of Powell for awhile now, because Powell refuses to lower interest rates - reasoning that Trump's tariffs will likely increase inflationary pressure. But, the Supreme Court telegraphed already that it views the relationship between the President and the Federal Reserve as different from that of other independent agencies, and signaled that Chair Powell is legally protected from being removed by Trump.

Supreme Court signals Trump can't fire Fed Chair Powell​

All this begs the questions...

Can Trump fire Powell?
Should Trump fire Powell? and
Will Trump actually attempt to fire Powell or is it TACO time again?

And most importantly...

What will happen if Trump fires Powell?

 

[lawgator1]

Trump wants the economy to have the sugar high of lower rates in the short term. I have yet to hear any economist or business person say its worth trashing the traditional Fed independence.

 

[McDad]

The president cannot fire the Fed chair.

He is filling your balloons with a bunch of hot air (again) and you're responding as if it is real (again).

 

[NorthDallas40]

Trump wants the economy to have the sugar high of lower rates in the short term. I have yet to hear any economist or business person say its worth trashing the traditional Fed independence.

The Fed should only expect the luxury of independence as long as they act in an apolitical fashion. While I’m overall ok with Powell in his tenure he’s absolutely been playing politics since he was slow to increase rates when needed and slow to lower rates now. Granted Trump is making it easy for him with the tariff dumbassery but make no mistake Powell has been playing politics for a few years now

 

[lawgator1]

The Fed should only expect the luxury of independence as long as they act in an apolitical fashion. While I’m overall ok with Powell in his tenure he’s absolutely been playing politics since he was slow to increase rates when needed and slow to lower rates now. Granted Trump is making it easy for him with the tariff dumbassery but make no mistake Powell has been playing politics for a few years now

That seems like a bit of a leap since the reason that rates were not increased rapidly at the beginning was the belief -- reasonable at the time -- that Covid-induced supply shortages were driving what was thought to be transitory inflation. It wasn't just Powell that thought that, or other members of the Fed. As I recall, it was basically everybody that thought that.

In retrospect that was wrong in that inflation was very sticky.

And even now, the problem is that we can't seem to get down to the 2 percent level. Its currently at A 2.7 % annual rate. The 2 % mandate was adopted by the FMOC in 2012. Its hardly "playing politics" for the Fed to want to see us trending over time to the 2 % level and the fact that its been so stubborn is exactly reason not to jump the gun.

I wish rates were lower, too. But there's a lot that goes into the inflation rate and I don't for a second trust Trump to have the interests of the economy in 15 years in mind when he acts. He does have the right to replace Powell and surely will in May. There's no hurry here as adjusting these rates to re-direct the economy in the short run is like trying to turn an aircraft carrier in a matter of a few feet.

Reminder, the Senate has to confirm the Fed chair. If its someone like Bessent I'd expect him to be confirmed easily upon commitment he won't act on rates to suit Trump's whims. I fear he will nominate some tv screecher though, like a Bartiromo. I would hope that that point the Senate leadership will have told the administration not to bother.

 

[MontyPython]

The president cannot fire the Fed chair.

He is filling your balloons with a bunch of hot air (again) and you're responding as if it is real (again).

While I agree that Trump is a big bag of hot air, the President absolutely does have the authority to fire the Fed Chair for cause.

 

[NorthDallas40]

That seems like a bit of a leap since the reason that rates were not increased rapidly at the beginning was the belief -- reasonable at the time -- that Covid-induced supply shortages were driving what was thought to be transitory inflation. It wasn't just Powell that thought that, or other members of the Fed. As I recall, it was basically everybody that thought that.

In retrospect that was wrong in that inflation was very sticky.

And even now, the problem is that we can't seem to get down to the 2 percent level. Its currently at A 2.7 % annual rate. The 2 % mandate was adopted by the FMOC in 2012. Its hardly "playing politics" for the Fed to want to see us trending over time to the 2 % level and the fact that its been so stubborn is exactly reason not to jump the gun.

I wish rates were lower, too. But there's a lot that goes into the inflation rate and I don't for a second trust Trump to have the interests of the economy in 15 years in mind when he acts. He does have the right to replace Powell and surely will in May. There's no hurry here as adjusting these rates to re-direct the economy in the short run is like trying to turn an aircraft carrier in a matter of a few feet.

Reminder, the Senate has to confirm the Fed chair. If its someone like Bessent I'd expect him to be confirmed easily upon commitment he won't act on rates to suit Trump's whims. I fear he will nominate some tv screecher though, like a Bartiromo. I would hope that that point the Senate leadership will have told the administration not to bother.

Nope. Powell absolutely waiting too long and your team had home court advantage at the time so I completely expect you to carry the “transitory inflation” narrative.

 

[NorthDallas40]

The president cannot fire the Fed chair.

He is filling your balloons with a bunch of hot air (again) and you're responding as if it is real (again).

Monty is right there are allowances to remove the Fed chair for cause. I don’t think he will be successful so you got a like I think it’s just usual Trump foot stomping antics.

 

[CobbVol]

That seems like a bit of a leap since the reason that rates were not increased rapidly at the beginning was the belief -- reasonable at the time -- that Covid-induced supply shortages were driving what was thought to be transitory inflation. It wasn't just Powell that thought that, or other members of the Fed. As I recall, it was basically everybody that thought that.

In retrospect that was wrong in that inflation was very sticky.

And even now, the problem is that we can't seem to get down to the 2 percent level. Its currently at A 2.7 % annual rate. The 2 % mandate was adopted by the FMOC in 2012. Its hardly "playing politics" for the Fed to want to see us trending over time to the 2 % level and the fact that its been so stubborn is exactly reason not to jump the gun.

I wish rates were lower, too. But there's a lot that goes into the inflation rate and I don't for a second trust Trump to have the interests of the economy in 15 years in mind when he acts. He does have the right to replace Powell and surely will in May. There's no hurry here as adjusting these rates to re-direct the economy in the short run is like trying to turn an aircraft carrier in a matter of a few feet.

Reminder, the Senate has to confirm the Fed chair. If its someone like Bessent I'd expect him to be confirmed easily upon commitment he won't act on rates to suit Trump's whims. I fear he will nominate some tv screecher though, like a Bartiromo. I would hope that that point the Senate leadership will have told the administration not to bother.

Then why did Powell and the FED act in Q4-2024? Election time?

October 2024 => Y2Y inflation rate rose to 2.6%, up from 2.4% in September.
• In response, the Fed CUT rates 25 BPS.

November 2024 => Y2Y inflation rate rose to 2.7%, up from 2.6% in October
• In response, the Fed CUT rates 25 BPS.

 

[lawgator1]

The Fed should only expect the luxury of independence as long as they act in an apolitical fashion. While I’m overall ok with Powell in his tenure he’s absolutely been playing politics since he was slow to increase rates when needed and slow to lower rates now. Granted Trump is making it easy for him with the tariff dumbassery but make no mistake Powell has been playing politics for a few years now

That seems like a bit of a leap since the reason that rates were not increased rapidly at the beginning was the belief -- reasonable at the time -- that Covid-induced supply shortages were driving what was thought to be transitory inflation. It wasn't just Powell that thought that, or other members of the Fed. As I recall, it was basically everybody that thought that.

In retrospect that was wrong in that inflation was very sticky.

And even now, the problem is that we can't seem to get down to the 2 percent level. Its currently at A 2.7 % annual rate. The 2 % mandate was adopted by the FMOC in 2012. Its hardly "playing politics" for the Fed to want to see us trending over time to the 2 % level and the fact that its been so stubborn is exactly reason not to jump the gun.

I wish rates were lower, too. But there's a lot that goes into the inflation rate and I don't for a second trust Trump to have the interests of the economy in 15 years in mind when he acts. He does have the right to replace Powell and surely will in May. There's no hurry here as adjusting these rates to re-direct the economy in the short run is like trying to turn an aircraft carrier in a matter of a few feet.

Reminder, the Senate has to confirm the Fed chair. If its someone like Bessent I'd expect him to be confirmed easily upon commitment he won't act on rates to suit Trump's whims. I fear he will nominate some tv screecher though, like a Bartiromo. I would hope that that point the Senate leadership will have told the administration not to bother.

Then why did Powell and the FED act in Q4-2024? Election time?

October 2024 => Y2Y inflation rate rose to 2.6%, up from 2.4% in September.
• In response, the Fed CUT rates 25 BPS.

November 2024 => Y2Y inflation rate rose to 2.7%, up from 2.6% in October
• In response, the Fed CUT rates 25 BPS.

Come on, you know better. The trend is your friend. They don't wait until the month its EXACTLY 2 % to cut rates; and they don't automatically increase rates when in one month it is 2.1%.

 

[hog88]

That seems like a bit of a leap since the reason that rates were not increased rapidly at the beginning was the belief -- reasonable at the time -- that Covid-induced supply shortages were driving what was thought to be transitory inflation. It wasn't just Powell that thought that, or other members of the Fed. As I recall, it was basically everybody that thought that.

In retrospect that was wrong in that inflation was very sticky.

And even now, the problem is that we can't seem to get down to the 2 percent level. Its currently at A 2.7 % annual rate. The 2 % mandate was adopted by the FMOC in 2012. Its hardly "playing politics" for the Fed to want to see us trending over time to the 2 % level and the fact that its been so stubborn is exactly reason not to jump the gun.

I wish rates were lower, too. But there's a lot that goes into the inflation rate and I don't for a second trust Trump to have the interests of the economy in 15 years in mind when he acts. He does have the right to replace Powell and surely will in May. There's no hurry here as adjusting these rates to re-direct the economy in the short run is like trying to turn an aircraft carrier in a matter of a few feet.

Reminder, the Senate has to confirm the Fed chair. If its someone like Bessent I'd expect him to be confirmed easily upon commitment he won't act on rates to suit Trump's whims. I fear he will nominate some tv screecher though, like a Bartiromo. I would hope that that point the Senate leadership will have told the administration not to bother.

Carry that water LG.

 

[McDad]

While I agree that Trump is a big bag of hot air, the President absolutely does have the authority to fire the Fed Chair for cause.

I understand. that's a fair and accurate correction to my post.

But there is no cause as we historically think of it (from google AI, malfeasance, inefficiency, neglect of duty).

I ignore most of what djt says. To be fair, i don't give a tinker's taint if Powell gets fired. But I don't think djt has enough evidence to do it.

 

[McDad]

Monty is right there are allowances to remove the Fed chair for cause. I don’t think he will be successful so you got a like I think it’s just usual Trump foot stomping antics.

I ignore his tantrums.

Trump and Biden have proven that the president is not as consequential in our day to day lives as we make him out to be.

 

[McDad]

That seems like a bit of a leap since the reason that rates were not increased rapidly at the beginning was the belief -- reasonable at the time -- that Covid-induced supply shortages were driving what was thought to be transitory inflation. It wasn't just Powell that thought that, or other members of the Fed. As I recall, it was basically everybody that thought that.

I honestly read your post shaking my head in disbelief the whole time.

The only people who believed in "transitory inflation" were the people who needed to believe in it because their team was espousing it.

 

[NorthDallas40]

I ignore his tantrums.

Trump and Biden have proven that the president is not as consequential in our day to day lives as we make him out to be.

And that is so crazy. The single most powerful individual in the world is whom ever holds that office. Once they leave that office their relevance is immediately reduced. Yet it’s been cheapened by both political parties to where we just ignore the wasted air coming out of that office holder’s pie hole.

 

[McDad]

And that is so crazy. The single most powerful individual in the world is whom ever holds that office. Once they leave that office their relevance is immediately reduced. Yet it’s been cheapened by both political parties to where we just ignore the wasted air coming out of that office holder’s pie hole.

Except for Bush's war and Obama's ACA, i can't even think of a policy which was abruptly consequential. I suppose we could make a case for trump and biden massive spending and the inflation it caused.
But yeah, I live my life relatively unscathed from what the "most powerful person in the world" is doing. And to me, that's a good thing.

 

[NorthDallas40]

Except for Bush's war and Obama's ACA, i can't even think of a policy which was abruptly consequential. I suppose we could make a case for trump and biden massive spending and the inflation it caused.
But yeah, I live my life relatively unscathed from what the "most powerful person in the world" is doing. And to me, that's a good thing.

Yep. It’s amazing how quickly your own stress level immediately lowers once you stop listening to all of the damn windbag assholes. At this point any focus I put on them is just to find material to mock (EX the daily tear I am on in the tariff thread ).

 

[MontyPython]

Yep. It’s amazing how quickly your own stress level immediately lowers once you stop listening to all of the damn windbag assholes. At this point any focus I put on them is just to find material to mock (EX the daily tear I am on in the tariff thread ).

I find venting on the PF therapeutic. Plus Hogg enjoys being spanked.

 

[NorthDallas40]

I find venting on the PF therapeutic. Plus Hogg enjoys being spanked.

Lol! I too enjoy slinging mud around here.

 

[Sin City Vol]

What kind of idiot would appoint a guy like Powell?

 

[hog88]

I understand. that's a fair and accurate correction to my post.

But there is no cause as we historically think of it (from google AI, malfeasance, inefficiency, neglect of duty).

I ignore most of what djt says. To be fair, i don't give a tinker's taint if Powell gets fired. But I don't think djt has enough evidence to do it.

Agreed

 

[LouderVol]

I honestly read your post shaking my head in disbelief the whole time.

The only people who believed in "transitory inflation" were the people who needed to believe in it because their team was espousing it.

and how long did it take them to finally recognize it was "transitory"? wasn't it years? but in the case of Trump's dumb tariffs actions its apparently logical to the same decision makers to not wait months before deciding it was permanent?

as others have said, he has been playing politics for a long time.

Obama and Bush road the artificially low "sugar rush" interest rates too.