Tag Archives: the Federal Reserve

It’s Time For A Change

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Federal Reserve Chairman Jerome Powell’s term expires in May 2026. It’s a shame that he will be in charge until then. He claims to be apolitical, but his actions tell another story. On Saturday, John Hinderaker at Power Line Blog posted an article about Federal Reserve Chairman Jerome Powell’s term.

The article reports:

We hear constantly about the importance of the independence of the Federal Reserve. Fine: but what if the Fed isn’t independent of politics, it is just independent of, and hostile to, the administration that is in power?

Some think that is the situation now before us. Stephen Moore comments on Fed Chairman Jerome Powell’s most recent pronouncements:

Fed Chairman Jerome Powell was full of doom and gloom yesterday [Wednesday], forecasting 1.6% growth for this year and closer to 1.5% next year.

Was he talking about Afghanistan or the United States?

In the second quarter of this year, the U.S. economy grew by 3.3%, and with a few weeks to go in the third quarter, the Federal Reserve Bank of Atlanta is forecasting above 3% growth – twice Powell’s anemic rate.

…Powell never mentioned that real household incomes are up $1,100 for the first seven months of 2025.

He attacks Trump’s tariffs and more restrictive immigration policies as restricting growth – and he’s right on that. But he never mentions the Trump tax cut, the immediate expensing for capital purchases (which has spurred an investment boom), the deregulations that could save up to $1 trillion this year, or that Trump’s pro-energy policies have increased U.S. production of oil and gas to record highs, or that the area where job growth is way down is in government employment – which is GOOD for the economy.

So Powell is hostile to the administration’s economic agenda, and–perhaps–has positioned the Fed in opposition to it.

Stephen Moore notes:

There’s also something almost comical of a Fed chair who let inflation soar by 21% and promised it was all “transitory” now terrified of an inflation rate of less than 3% this year.

The article notes:

Then, of course, there is the Fed’s Taj Majal, construction of which I believe President Trump has stopped. But that is a minor point, compared to the possibility that the Chairman of the Federal Reserve is actively trying to undermine America’s economic policies. That isn’t independence, it is partisanship.

If you are unfamiliar with the history of the Federal Reserve, please watch the video below about the history and purpose of the organization.

The Federal Reserve is not what we were told it is.

A Statement That Makes The Deep State Tremble

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The Federal Reserve is a misnamed sketchy operation. There is a book and a YouTube video called “The Creature From Jekyll Island” that explains the dirty tricks involved in the creation of the Federal Reserve and its true purpose. The Federal Reserve is neither federal nor a reserve. Auditing the fed is a really good idea that the fed has avoided for years.

On Monday, Hot Air posted an article quoting CNBC:

Treasury Secretary Scott Bessent on Monday suggested a review of the Federal Reserve that would go beyond the current controversy over building renovations and look at its overall function.

“What we need to do is examine the entire Federal Reserve institution and whether they have been successful,” Bessent said during an interview on CNBC’s “Squawk Box.” “Has the organization succeeded in its mission? If this were the [Federal Aviation Administration] and we were having this many mistakes, we would go back and look at why has this happened.”

The article also quotes Senator Rand Paul:

Dr. Rand Paul (R-KY) has reintroduced the Federal Reserve Transparency Act, famously known as “Audit the Fed” legislation to require a full audit of the Federal Reserve’s operations and increase congressional oversight of its decision-making. In conjunction with the bill’s reintroduction, Senator Paul also released the latest edition of his Waste Report, which exposed the Federal Reserve’s $600 million cost overrun on renovations to its Washington, D.C. headquarters—now projected to cost taxpayers $2.5 billion in total. The report underscores the lack of transparency and accountability at the Fed, which remains exempt from a full audit by Congress or the Government Accountability Office.

“No institution holds more power over the future of the American economy and the value of our savings than the Federal Reserve,” said Dr. Paul. “It’s long past time for Congress to stop shirking its duty and hold the Federal Reserve accountable.”

“It is Congress’ duty to hold the Fed accountable,” said Senator Marsha Blackburn (R-TN). “For too long, the Federal Reserve has operated behind closed doors while making decisions that impact the American economy. Throughout my service in Congress, I have worked to audit the Fed, and this legislation is necessary to shine a light on the Fed’s operations and provide transparency to Congress and American taxpayers.”

The year 1913 was a horrible year for the Democratic Republic of America. That year gave us the federal income tax, the federal reserve, and the direct election of U.S. Senators. All three of those things need to go away.

The Latest Inflation Numbers

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When reading statistics about anything, remember that a good statistician can make numbers say anything he wants them to say. With that in mind, I think the June inflation numbers look really good.

On Tuesday, CNBC reported:

  • The consumer price index, a broad-based measure of goods and services costs, increased 0.3% on the month, putting the 12-month inflation rate at 2.7%, in line with expectations.
  • Core inflation picked up 0.2% on the month, with the annual rate moving to 2.9%, with the annual rate in line with estimates.
  • While the evidence in June was mixed on how much influence tariffs had over prices, there were signs that the duties are having an impact. Apparel and home furnishing prices rose, though vehicle prices fell.

…Excluding volatile food and energy prices, core inflation picked up 0.2% on the month, with the annual rate moving to 2.9%, with the annual rate in line with estimates. The monthly level was slightly below the outlook for a 0.3% gain.

Inflation in June 2022 was 9.1 percent, but began going down slowly after that. Somehow, though, even when the rate of inflation comes down, the price of everything does not go back to where it started.

The article concludes:

Amid the previously muted inflation ratings, Trump has been urging the Federal Reserve to lower interest rates, which it has not done since December. The president has insisted that tariffs are not aggravating inflation, and has contended that the Fed’s refusal to ease is raising the costs the U.S. has to pay on its burgeoning debt and deficit problem.

Central bankers, led by Chair Jerome Powell, have refused to budge. They insist that the U.S. economy is in a strong enough position now that the Fed can afford to wait to see the impact tariffs will have on inflation. Trump in turn has called on Powell to resign and is certain to name someone else to the job when the chair’s term expires in May 2026.

Markets expect the Fed to stay on hold when it meets at the end of July and then cut by a quarter percentage point in September.

The Federal Reserve was established in 1913 for the purpose of concentrating America’s wealth in the New York City Banks (yes, I know that wasn’t what you were told). It needs to go away. For further information, see The Creature from Jekyll Island by G. Edward Griffin.

Admitting The Obvious

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I have stated my views of the Federal Reserve numerous times. It needs to go. For an explanation of why I believe this, please watch this video. It is long, but worth the watch.

If I had any doubts about the politicization of the Federal Reserve, those doubts were confirmed by an article posted at Breitbart on Tuesday.

The article reports:

The Fed chair (Federal Reserve Chair Jerome Powell) once warned against using speculative forecasts to drive policy. Now he’s doing exactly that.

Federal Reserve Chair Jerome Powell made a quiet but extraordinary admission on Tuesday: if the Fed were following the actual data, it would be cutting interest rates. But it isn’t—because the Fed expects President Trump’s tariffs to raise inflation, and it’s choosing to act on that forecast instead.

“If you just look at the basic data and don’t look at the forecast, you would say that we would’ve continued cutting,” Powell told lawmakers. “The difference, of course, is at this time all forecasters are expecting pretty soon that some significant inflation will show up from tariffs. And we can’t just ignore that.”

That’s a remarkable departure from the Fed’s longstanding mantra of data-dependence. It also reveals the extent to which the central bank is allowing anti-tariff bias—and speculative inflation models—to override clear economic signals pointing toward looser policy.

The data are, in Powell’s own words, favorable to a resumption of rate cuts. Inflation has come down meaningfully. We don’t yet have the personal consumption expenditure index reading for May, but Harvard economist Jason Furman’s calculation based on CPI is that the three-month annualized rate is around 0.6 percent for headline inflation and 1.4 percent for annualized inflation. The year-over-year figure is two percent for headline, exactly at the Fed’s target, and 2.5 percent for core inflation.

The article reminds us of some of Powell’s recent mistakes:

In some ways, Powell’s decision to ignore current data in favor of tariff-driven inflation forecasts echoes a costly Fed error from the recent past. In 2021, the Fed insisted that inflation was “transitory,” even as prices surged month after month. Officials were guided not by what the data showed, but by what their models predicted—that supply chain pressures would ease and inflation would naturally subside. It didn’t. And the Fed was forced to scramble, hiking rates aggressively in 2022 and 2023 to restore credibility.

Reducing interest rates at this point would help significantly in the recovery of America’s economy. After four years of inflation, lower wages, and slow employment growth, Americans are ready for the Federal Reserve to be a help rather than a hindrance.