Chicago Fed President Austan Goolsbee says a move by Trump to terminate Jerome Powell would ‘undermine the credibility of the Fed’

• President Donald Trump “The termination” cannot come at a speed enough. “This led to a discussion about whether the president has the ability to remove the Federal Reserve Command.” The head of the Federal Reserve Bank at Chicago Austan Golsby says this step can “undermine the credibility of the FBI.”

This week, President Donald Trump has established a confrontation with the Federal Reserve Chairman Jerome Powell after the Central Bank President threw a letter of the effects of the definitions followed by the president.

Powell said on Wednesday during a speech at the Economic Club in Chicago: “The level of increases in the tariff that has been announced so far is much greater than what was expected, and it is likely that the same applies to economic effects, which will include high inflation and slower growth,” Powell said on Wednesday during a speech at the Economic Club in Chicago.

Trump soon fired again the next day, and he criticized Powell not to reduce interest rates quickly.

Trump wrote in a post on social media: “It is too late,” Jerome Powell, from the Federal Reserve, which was always too late and wrong, released another report, and a model, “chaos!” In a post on social media. “End Powell cannot come quickly enough!”

Although Trump behaves as if he had the authority to remove the Federal Reserve Chairman, this is a direct challenge of almost 100 years old from the case of the Supreme Court in which the court saw that President Franklin Roosevelt was unable to remove independent agency presidents without a good reason such as neglect or error. Meanwhile, many critics are afraid of Trump’s move to remove the first confidence in the American economy.

Federal Reserve Chairman does not comment on politics in order to support the central bank’s position as a non -political institution, but one of them fears what could happen if Trump has discovered a way to remove Powell.

“I hope that we will not move ourselves to an environment in which criticism is independent,” said Chicago Austan Golsby. CBS“Facing the nation with Margaret Brennan” on Sunday. “Because this will undermine the credibility of the federal reserve.”

Goodsbee also pointed out that there is a “virtual consensus” among economists that the Federal Reserve should have a critical independence from political intervention.

“They have reached this not as a theory, but only by looking at all over the world in places where he does not have the independence of money,” said Goolsbee. “the [stance] The Federal Reserve or any central bank is able to do the task that it needs to be done really important. “

Powell also said that he could not be expelled by Trump, and when asked whether he would leave if the president asked him, no.

“In general, the independence of the federal reserve is widely and supported in Washington, in congress, where it really matters,” Powell said at the Chicago Economic Club.

Trump was also the person who appointed Powell in 2017, but he greatly criticized everything he did, including reducing interest rates, increasing interest rates, and maintaining them fixed.

However, there is a discussion about whether Fed Independence is really protected. Some experts argue that monetary independence is more than the standard of law.

“The laws also depend on people and those who are, how they explain things, and what they want to do. I think there may be certainly some reduction in the extent of the federal reserve independence to move forward.” luckGreg Macina. “We hope not.”

This story was originally shown on Fortune.com

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2025-04-20 18:49:00