US President Donald Trump on Monday used a Federal Reserve official’s own words to amplify his continual demands for lower interest rates.
The latest in Trump’s daily attacks on the Fed, turns up the temperature for the central bank a week before its latest policy meeting, when it expected to cut rates for the first time in a decade.
“It is far more costly for the Federal Reserve to cut deeper if the economy actually does, in the future, turn down!” Trump said on Twitter.
“Very inexpensive, in fact productive, to move now.”
Without naming him, Trump’s tweet repeated a central claim made last week by New York Federal Reserve President John Williams made last week.
In a speech to economic researchers on Thursday, Williams said decades of research suggested that when interest rates are already low, policymakers should cut them at the first signs of “economic distress” rather than waiting for more input.
Markets welcomed the news, which some investors took to mean the Fed could cut benchmark lending rates by as much as 50 basis points, something it has not done since the worst moments of the 2008 global financial crisis.
A large move would be unusual for the central bank which prefers to move in 25 bps increments, since a bigger rate cut would signal real concern about the economy, which policymakers continue to expect to grow.
A New York Fed spokesperson last week told reporters that Williams’ remarks were a comment on years of research, not a forecast of what the Fed will do later this month.
As president of the New York Fed’s branch, Williams’ serves as the influential vice chair of the Fed’s rate-setting Federal Open Market Committee.
While Fed Chairman Jerome Powell has steadfastly insisted policymakers discount political pressure, but has also said in recent weeks the Fed will do whatever it can to keep the economic expansion going, amid a slowing world economy and Trump’s trade wars enter their second year.
Trump is ‘having a full-blown mental breakdown’ and needs to resign: Ex-Trump staffer
Leading Republican elected officials should work with President Donald Trump's family to negotiate him resigning from office, a former top White House official suggested on MSNBC on Friday.
Former White House press secretary Anthony Scaramucci blasted his former boss during an interview with Chuck Todd on MSNBC's "Meet the Press Daily."
"He has totally and completely lost it. There is nobody that can look at the situation, read the tweets, look at the press sprays, and say he hasn’t lost it," Scaramucci argued.
"What does that mean, lost it?" Todd asked. "Define that."
Obama’s chief economist warns of ‘a very high chance’ Trump’s trade war could cause 2020 recession
The former chair of the Council of Economic Advisers under President Barack Obama warned of "a very high chance" of Trump's trade war with China resulting in a recession -- "just in time for 2020."
Austan Goolsbee was interviewed by MSNBC's John Heilemann on Friday after the DJIA closed down over 600 points after the trade war escalated on Friday.
"Just give us, if you would, Austan, your sense of what has unfolded today and how bad it is," Heilemann asked.
"Yes, it’s terrible, I'm phoning from a bunker as we speak," Goolsbee replied.
"There hasn’t been a day like this in a very long time. Yes, the markets sell a lot but the fact we’re going to have an escalating trade war, the president of the United States is publicly declaring the head of the Fed an enemy of the state and, oh, by the way, 40% of the Amazon is on fire and Ruth Bader Ginsburg is being treated for pancreatic cancer," he continued. "If this is on a Friday, it makes it bad for Monday."
Trump responds to China raising tariffs — by raising tariffs on over half a trillion dollars in Chinese goods
After US markets tanked on Friday, President Donald Trump dramatically escalated his trade war with China.
"For many years China (and many other countries) has been taking advantage of the United States on trade, intellectual property theft, and much more. Our country has been losing hundreds of billions of dollars a year to China, with no end in sight," Trump tweeted.
"Sadly, past Administrations have allowed China to get so far ahead of fair and balanced trade that it has become a great burden to the American taxpayer. As President, I can no longer allow this to happen," he argued.