Surprisingly, the only current presidential candidate that is mentioning anything at all about the Federal Reserve is Donald Trump. Hillary Clinton has remained quiet, Bernie Sanders ignores it entirely and Ted Cruz, who was pretty good at the start, hasn’t said anything lately (SEE: David Stockman asks valid question: ‘Why does the Federal Reserve get amnesty in GOP debates?’).
So, what does Trump have to say about the Fed this time?
Speaking in an interview with Fortune magazine, Trump said that he may replace Fed Chair Janet Yellen once her term is up, while noting that he likes low interest rates. Trump explained that Yellen has “done a serviceable job,” noting that he wouldn’t reveal if he’d reappoint her. However, he did say that he’s “more inclined” to put some other people in charge of the central bank.
As we’ve reported in the past, Trump has been in support of reining in the power of the Fed. In the interview, Trump confirmed that he would “absolutely” support ideas that would reduce the amount of power the Fed. He also reiterated his support of allowing the Congress to audit the Fed (SEE: Donald Trump wants to audit the Federal Reserve, criticizes Ted Cruz for missing key vote).
In regards to current monetary policy, Trump conceded that he supporters the near-zero interest rate policy because of the weak U.S. economy.
“The best thing we have going for us is that interest rates are so low,” Trump told the publication. “People think the Fed should be raising interest rates. If rates are 3 percent or 4 percent or whatever, you start adding that kind of number to an already reasonably crippled economy in terms of what we produce, that number is a very scary number.”
Late last year, Trump warned that any rate hike would trigger a recession. He also prognosticated that the current economic bubble would probably pop once he took office.
The Republican frontunner said that he wants to take advantage of the lower interest rates so he could increase infrastructure and military spending and refinance the debt. With that being said, Trump admitted that low rates hurt financially prudent Americans.
“The problem with low interest rates is that it’s unfair that people who’ve saved every penny, paid off mortgages, and everything they were supposed to do and they were going to retire with their beautiful nest egg and now they’re getting one-eighth of one percent. I think that’s unfair to those people.”
What about the national debt? Despite chastizing the $19 trillion debt at the start of his presidential campaign, Trump seems to have soften his tone.
“You could pay off a percentage of it, depending on how aggressive you want to be,” Trump said. “I’d rather not be all that aggressive. I’d rather not have debt but we’re stuck with it. If I had a choice of taking over debt free or having $19 trillion – which by the way is going up to $21 trillion very soon because of the omnibus budget, which is a disaster. If I had my choice I’ll take no debt every time.”
In conclusion, Trump now seems to be in favor of low interest rates; he doesn’t want to be too aggressive in tackling the soon-to-be $21 trillion national debt; and it’s unclear if Yellen is gone under a Trump administration.
Are insiders beginning to take over the Trump campaign? It appears so.
–AM
Photo by Evan Guest via Flickr.
I have always questioned Trumps claim to be an “outsider”. The probability of his being well connected to the Ruling Class Elitist by virtue of his business / wealth / position in those circles is greater than he is letting on.
I also feel that he has a greater understanding of the whole rigged “financial” system of currency, and Central Banking, and probably has understood why JFK was killed. So assuming that he would go up against the Fed is highly unlikely.
The People still get screwed in the election process in that the same owners own all the horses in the race.