During a televised Cabinet meeting in the White House on Tuesday, December 2, President Donald Trump angrily railed against familiar targets ranging from former Presidents Joe Biden and Barack Obama to U.S. Federal Reserve Chairman Jerome Powell. And he reiterated his call for steep interest rates cuts.
Although Powell has been gradually lowering interest rates, Trump believes the Fed chairman isn't lowering them nearly enough. And he resents him deeply for it.
Trump told Cabinet officials and reporters, "We have a guy that's a stubborn ox who probably doesn't like your president, your favorite president. We have an incompetent Fed chair, a real dope who should reduce rates. We'll be announcing somebody probably early next year for the new Fed chairman."
Powell's term ends in May 2026, and Trump is determined to replace him with an obedient loyalist who will lower interest rates as much as he wants.
In an article published on December 3, New York Times reporters Alan Rappeport and Colby Smith explain why the search for a Powell successor puts considerable pressure on Treasury Secretary Scott Bessent.
"In an August post on Truth Social," Rappeport and Smith note, "President Trump lashed out at his first-term Treasury secretary, Steven Mnuchin, for advising him to select Jerome H. Powell as chair of the Federal Reserve in 2017. Mr. Trump, who had spent months fuming that Mr. Powell was not cutting interest rates quickly enough, wrote: 'Steve 'Manouychin' really gave me a 'beauty' when he pushed this loser. The damage he has done by always being Too Late is incalculable.'"
The Times reporters add, "The sharp criticism of one of Mr. Trump's most loyal first-term Cabinet members came as the president's current treasury secretary, Scott Bessent, was preparing to find a successor for Mr. Powell, whose term as chair expires next year."
Rappeport and Smith emphasize that the "stakes for the next Fed chair will be high."
"Mr. Trump has made no secret that he expects his pick to swiftly cut rates," the Times journalists note. "But the selection is also putting Mr. Bessent in an unusually uncomfortable spot, with Mr. Trump making clear that his treasury secretary's fortunes are tightly tied to what the Fed does next…. Although the final decision will be Mr. Trump's to make, the pressure is now on Mr. Bessent to steer through a candidate who will be the monetary policy dove that Mr. Trump desires."
Read the full New York Times article at this link (subscription required).
