President Donald Trump excoriated Jerome Powell, the chairman of the U.S. Federal Reserve, and the stock market responded by continuing to shed value.
The market has lost trillions of dollars in value since Trump commenced his plan to issue massive tariffs to raise revenues and lower the trade deficit with U.S. trading partners.
‘There can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW.’
On Thursday, Trump accused Powell of waiting too long to lower interest rates at the Fed, and he continued his attack on Monday.
“’Preemptive Cuts’ in Interest Rates are being called for by many. With Energy Costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other ‘things’ trending down, there is virtually No Inflation,” said Trump on social media.
“With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” he continued. “Europe has already ‘lowered’ seven times. Powell has always been ‘To Late,’ except when it came to the Election period when he lowered in order to help Sleepy Joe Biden, later Kamala, get elected. How did that work out?”
After his comments, the S&P 500 index dropped by 3% for a total drop of 12% since the start of the year. The Dow Jones Industrial Average has lost about 10%, while the Nasdaq has fallen by 18%.
Powell had said in remarks at the Economic Club of Chicago that he believed the economy was very strong but that the future was cloudy because of volatility caused by the president’s sudden and large-scale tariff policies.
Trump had previously suggested that Powell would soon be terminated from the position. Powell has previously said that the president cannot legally fire the chair of the Federal Reserve, and he reiterated that position Thursday.
“Generally speaking, Fed independence is very widely understood and supported in Washington, in Congress, where it really matters,” Powell said.
“We’re never going to be influenced by any political pressure,” said Powell. “People can say whatever they want. … That’s not a problem, but we will do what we do strictly without consideration of political or any other extraneous factors.”
In June 2022, Powell said the Fed’s goal was to slowly ease the pain of inflation, which was at 8% at the time, down to the more manageable level of 2%.
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