Donald Trump Threatens to Takeover Fed as President.
FULL TRANSCRIPT
Bloomberg and the Wall Street Journal
are reporting that Donald Trump has big
plans of for the Federal Reserve with
his campaign and while there have been a
lot of different plans circulating
including the 2025 Heritage Foundation
plan all of them seem to revolve around
three important topics one firing Jerome
Powell this is clearly a signal or a
tool to indicate that anyone suffering
from high interest rates today on their
cars their credit cards Home Loans
student loans whatever it may be should
potentially see Donald Trump as somebody
who is going to solve that issue by
basically cutting off the head of the
Leviathan now obviously the point of the
Federal Reserve is to raise interest
rates in a high inflation environment so
some argue that this could also be
Donald Trump's punishment for drum
Powell allowing or enabling the high
inflation to occur in the first first
place now remember the goal in my videos
is always to be unbiased and neutral so
I'm going to do my best here Jerome
Powell has gotten the blessing from Joe
Biden to continue doing as he pleases
this is very normal is very normal well
at least since about the Paul vulker era
which is about 40 years ago for the
Federal Reserve to have substantial
political Independence and even though
someone like the chairperson of the
Federal Reserve can be a appointed by
the president and confirmed by Congress
the chairperson of the Federal Reserve
generally makes decisions without regard
to politics or elections now 50% of
people hearing me say that are going to
say bull crap they are going to try to
manipulate the election this is also
entirely possible although it is not
something that we can outrightly prove
consider the possibility that the
Federal Reserve realizes they're going
to lose their jobs and their
independence if Donald Trump is elected
is it then possible that the Federal
Reserve rapidly Cuts interest rates
before the election to preserve the
independence of the Federal Reserve
institution yes is it also possible that
the Federal Reserve Cuts interest rates
right before the election because
something happens in the economy that
forces them to do so but then it looks
like they cut interest rates for
political reasons yes is it also
possible that the Federal Reserve does
not cut interest rates at all this year
and then still gets fired by Donald
Trump next year if Donald Trump wins the
election yes so all of these things can
happen and so as someone watching we
want to evaluate what are some potential
outcomes if Donald Trump wins and ends
up revamping the Federal Reserve to
where the Federal Reserve has to consult
with the sitting president starting in
2025 before they make interest rates
decisions well let's base this off of
what the Wall Street Journal and uh
Bloomberg and other sources are
indicating first quick reminder today is
the expiration of that coupon code so
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kevin.com so let's now imagine a
potential reality where Donald Trump
wins oh and remember that coupon code
expires tonight where Donald Trump wins
wins and then remove some of the Federal
Reserve Independence well first we think
jpow would get fired the next action
that would likely happen is Donald Trump
would try to do anything to actually
weaken the US dollar one of the ways you
can easily weaken the US dollar is by
lowering interest rates so I would
suspect that we would very rapidly get
interest rate cuts and a substantially
weaker dollar there are reasons why the
dollar Falls in value when rates are
lower it's not so important right now
but basically people are attracted to
investing in things with higher interest
rates so therefore the currency offering
that higher rate has more demand and
goes up don't worry about that point is
lower rates weaker dollar what does that
do what potentially drives up the
competitiveness of us businesses in a
global economy a weaker local currency
makes it easier to sell local products
and services around the world whether
those are data service products
Machinery like we sell electrical
Machinery to China yes we buy junk from
China but we also export a lot of
electrical Machinery to China this makes
it easier for our manufacturing
companies to sell products across the
globe however it makes it more expensive
for us as Travelers or purchasers of
foreign goods and services to buy those
goods and services makes it more
expensive to go on vacation in Europe or
the United Kingdom makes it more
expensive to buy services from abroad
maybe designers or work from homers or
whatever in other countries a lot of
folks though have an American America
First approach and say forget that let
other countries be more expensive and
let's focus more on bringing
manufacturing home to America and
encouraging jobs in America there's a
balance to all of this because obviously
if the United States weakens it its
currency it's possible you could set off
a currency war and you could find
weakening of currencies at other
countries this could potentially set off
an inflationary spiral which could lead
the entire economy into an unfortunate
situation where we would have to raise
rates even higher than we've ever had to
before go from say 5% to 10% or more
like 19% like what we saw in the 80s and
we create a nasty brutal Global
recession so it's not all good though I
will say fate loves irony and I've been
saying since quite frankly the 2020
election time frame when Biden and Trump
were running against each other I've
been saying the greatest irony would be
that we end up getting a surge of
inflation during a Biden Administration
following all of the money printing that
happened both under Trump and Biden and
that that inflation would slowly start
falling at the end of a Biden first term
but the frustration of that inflation
would lead to a return to Trump and then
you get a plummet of inflation a
potential plummet in interest rates in
the short term but do you potentially
then froth up an even larger bubble
ignoring the part about the large larger
bubble that
irony is a potential reality and as Elon
Musk Elon Musk likes to say fate loves
irony so we'll see what happens but
Donald Trump's plans are very clear now
whether or not they're going to flip on
those plans like they did the first time
around in the first uh uh term that
Donald Trump was President where they
argued we're going to fire drum pow they
ultimately didn't although drum pow did
back down so it does make you wonder did
he back down due to political pressure
or what this was back in 2019 they
started raising rates you ended up
having a liquidity crisis in September
of 2020 uh sorry 2019 and uh that was
around the same time we started seeing
rat stabilize again we didn't get hikes
again starting in December of 2018 when
we had a crisis in the stock market it's
entirely possible uh that we end up
seeing a softening drum pow and whether
that's because of politics or not we'll
see but we are expecting the Federal
Reserve to pause their runoff of the Bal
sheet to try to prevent some of that
liquidity stress it's a little bit more
complicated but the point is I want to
ask you have you already used that
coupon code expiring tonight if not let
me know in the comments link down below
why let me know what you think about
Donald Trump potentially taking over the
Federal Reserve see you in the next one
goodbye and good luck
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