First Presidential Debate of 2016 Trump takes aim at the Federal Reserve
During the first presidential debate of 2016, Republican nominee Donald Trump used the platform as a way to redouble back his attack on the Federal Reserve and its chairwoman, Janet Yellen, accusing the central bank of “doing political things”. (1) Trump said, “We have a Fed that’s doing political things…by keeping the interest rates at this level,” As soon as Obama retires and “goes out to the golf course” the Fed will raise rates,” and “The U.S. economy is in a “big, fat, ugly bubble”.
Trump was clearly making accusations that Yellen is keeping interest rates low and helping President Obama.
Trump has attacked the Fed before. On CNBC earlier this month, he said Yellen should be “ashamed of herself” and that her policies were producing a “false stock market.”
Ms. Yellen last week denied that the Fed takes politics into account in its decision making. (2) “I can say, emphatically, that partisan politics plays no role in our decisions about the appropriate stance of monetary policy,” she said during a press conference after the Fed’s policy meeting, at which it decided to leave rates unchanged.
“We do not discuss politics at our meetings,” Yellen added. “And we do not take politics into account in our decisions.”
(3)“Congress very wisely established the Federal Reserve as an independent agency in order to insulate monetary policy from short-term political pressures,” she said.
Mrs. Clinton didn’t comment on Mr. Trump’s remarks about the Fed. But she has previously described it as inappropriate for candidates and presidents to weigh in on Fed actions.
Hold onto your hats America, this is going to be an interesting election year.