Trump Dispecration Fed Chief Powell is only new to the extent that pre -rude. Many government owners in the West or in India have had to go to the heads of central banks. The government feels good like cheap money. Central banks hate inflation. There is tensionJerome Powell can still be a marked person. Trump now says that he will not dismiss them. But you never know with Trump. He called Powell “too late” for diyating in front of the 2022 inflation growth. In addition, “low IQ”, “very stupid”, “average mentally person”, and announced, “I think he is doing a terrible thing.” Nevertheless, Trump is in a disadvantage: “I do it in every way in the book. I’m bad. I am good. Nothing works.”Now, Trump’s associate Fed Building’s renewal is trying to a pinner over a cost of alleged $ 700MN, which can let him pin Matt on Matt in his last year as a fed chair. Or not. Powell, finally, has been here first.‘Crazy’, ‘Loco’When Trump chose Powell over Janet Yellen at the end of 2017, he will provide: “strong, committed, smart”, someone who “needs his leadership in the coming years”. But six months in his first term, he was already out of favor.A non-economic-pole’s lawyer by training-he was expected to advocate the line at Trump’s interest rates. Originally, keep the interest rates low to increase growth, promote stock prices, and ensure Trump’s re -election in 2020. Powell left for a spine, and by August 2018, Trump Fed “Crazy”, “Loco”, “Gon Wild”. He told The Wall Street Journal: “(Powell) was considered a low-ended person. It turns out that he is not.,interested partiesThe cost of cruel money of Trump-Powell fights, or cost of interest rates. Govts universally want to be cheaper money, so that business does not hesitate to borrow for expansion. Extending businesses add jobs, GDP grows, stock markets zoom, and everyone lives happily.However, cheap money can also increase prices, or inflation, and when things cost more, people buy less, so businesses stopped expansion. And if the demand falls too much, the jobs are lost, and everyone is pathetic.Therefore, the purpose of central banks is to maintain price increase with interest rates. But because the interest rates, unlike the cat of Shroudinger, cannot be in two states – high and low, in this case – at the same time, government and central bankers with a spine should agree to disagree.Nixon was worseHistory repeats itself. In 1969, Nixon chose Arthur Burns Arthur Burns for his head. Like Trump, he believed that Burns would prove to be quite quite, and just to ensure that he told him: “I know the myth of the autonomous Fed is …” to ensure that everyone else got this, he announced in the oath taking of Burns: “I honor his freedom. However, I hope, independently, he will conclude that my thoughts are the ones that should be followed. ,Nixon wanted a lower rate with a look at the 1972 election, and we know from “Nixon Tapes” that he told Burns in October 1971: “Liquidity problem (too much money in the system) … is just rubbish”. Burns forced. Their rate cuts stimulated the economy in a short -term and assigned a landslide victory to Nixon, but then a problem of inflation arose for a decade, and became the strongest argument for the Central Bank Independence (CBI).Freedom dayCentral banks like RBI and US Fed are relatively recently recently development. Prior to WW-2, he was only the lender of the last resort. After the war, it became their job to determine interest rates, but with a lot of government intervention. In India, RBI Governor Benegal Ram Rau left in 1957 after being face to face with Finance Minister TT Krishnamcharry. During the Vietnam War, President Johnson called the Fed Chair to his farm and criticized the prevailing monetary policy.Even Milton Freedman, who coined the word ‘Central Bank Independence’ in 1962, was not in favor of all powerful central banks. He wanted the government to determine the objectives of the central bank, and receive banks using policy equipment such as interest rates – without further intervention. The CBI was important for central banks to act without fear of criticism from a person like Trump, especially since there is a gap between policy implementation and results.
Former-American President Nixon
More than a century since 1923, the CBI has increased worldwide. The analysis of Trinity College Professor David Romeli shows that 370 banking reforms in 155 countries – 279 of these increased by CBI and 91 reduced it. Globally, the CBI index increased from 0.35 to 2020 in the 1970s to 0.6.So Trump, when he brought “independent” government agencies under his thumb with an executive order, made it clear that “this order would not be applicable to the conduct of monetary policy for the Board of Governors of the Federal Reserve System or Federal Open Market Committee.”Tasuhar continuesNevertheless, the old quarrel continues to control monetary policy. The resignation of Chidambaram-Sambrao Standoff at interest rates in 2012, two Argentina Central Bank chief-Martin Redrado’s resignation of Kuroda, Kuroda in 2013, Kuroda, all examples of the upper hand of Kuroda, the upper hand of the government in 2013.
East-RBI Governor
But central banks take a toll on stock and bonds. For example, S&P 500 took a 2.4% damp when Trump called Powell “major loser” in April. So he cannot use a hammer to dislike the Fed chief. What he can do is trying to close Powell with a screwdriver, and that is what he is doing.
