The article mostly talks about the ideas that the chairwoman of the Fed Janet Yellen has, and what are her ideas of what the Fed should do. Her idea is to increase the interest rates at a slow pace so there is no extreme inflation. Then they start talking about the Trump administration, and how this people might change the plans for the Fed. For the economic ideas and plans that Trump has they need the interest rates to increase faster than the Fed would like to increase them, that is why they talk about the pressure that Trump and his administration might put on the officials of the Fed so they do what Trump wants. Also the talk about how Trump could get this to be true by getting people into the Fed, since there are many important officials that are going to finish their role in the Fed soon, Trump has the opportunity to name people for those positions which might give him control over the Fed and he would have more control to change things like the interest rates. They said that this could also lead to new laws about all these issues, but the most important one that the Fed might start being related to politics and government issues, which could end up in a big problem and politicians crashing the economy because of lack of knowledge and using this as a tool for things like elections. Only over time we would see how much Trump is going to influence the Fed and how much is this going to affect the economy.
http://www.nytimes.com/reuters/2016/12/01/business/01reuters-usa-trump-fed-analysis.html?_r=0
Very interesting article to read and points you make in regards to the FED, although very unsettling. Depending on what Trump decides to do, this could be very disastrous for our nation.
ReplyDeleteAs much pressure as the administration puts on Yellen to raise rates, the chair of the fed doesn't have to report to the Administration. It is my belief and hope that Yellen continues with the discipline she has made her decisions up until this point.
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