Washington.- U.S. President Donald Trump called Federal Reserve Chairman Jerome Powell a “cretin” and said he “will leave soon” just days after the Federal Government opened a criminal investigation against the head of the Fed, whom the New Yorker has repeatedly criticized for his monetary policy.
«Last week, the average rate on 30-year mortgages fell below 6% for the first time in many years, declining very rapidly, and that without the help of the Federal Reserve. If it had the help of the Federal Reserve, it would be easier. But that inept person will be gone soon,» Trump said during a speech to underscore the alleged achievements of his Administration in Detroit.
The comments come after Powell announced over the weekend that the Department of Justice opened an investigation against him for alleged irregularities in the renovation of the entity’s headquarters in Washington.
It also arrives days before Trump announces Powell’s successor, amid growing doubts about the future independence of the issuing entity, as the president has said that the next Fed chairman should not “disagree” with his views on monetary policy.
Powell’s Possible Successor
In turn, during the speech delivered at the Detroit Economic Club, the president urged to follow the logic that when financial markets are rising, interest rates should be cut.
“Before, when the figures (of the stock markets) were good, interest rates went down. When the results were positive, the market soared,” Trump assured today during his speech in Detroit.
“This is how we’re going to achieve it again. That’s the traditional way. That’s the right way. Nowadays, if excellent figures are announced (in the financial markets), interest rates are raised to try to curb growth, so that the recovery that should have happened never occurs,” added the Republican.
Trump was referring, in general terms, to the fact that the markets have recently responded with moderate falls after learning positive macroeconomic data due to the possibility that this will stop the cycle of interest rate cuts initiated in September 2024 and due to what for some economists is the “addiction” of the markets to “free money”.
It is believed that Trump will announce this month his candidate to replace Powell, whose term expires in May, and among the main experts to replace him are his current economic advisor, Kevin Hasset, and former Fed governor, Kevin Warsh.
Trump has gone so far as to say that the U.S. should have rates (currently in a range between 3.5% and 3.75%) three percentage points lower.
