Trump: ‘Boneheads’ at the Fed Should Drop Interest Rates to Zero, or Lower

Author: , Post Date: September 11, 2019
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Excerpt from The Fiscal Times

By Michael Rainey
09/11/2019

President Trump blasted the “boneheads” at the Federal Reserve Wednesday for failing to reduce interest rates to zero or below.

“The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term,” Trump tweeted.

Trump framed the issue in part as a matter of competition with other advanced economies. “We have the great currency, power, and balance sheet … The USA should always be paying the the [SIC] lowest rate. No Inflation! It is only the naïveté of Jay Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of “Boneheads,” he wrote. But many economists say the negative interest rate policies in Europe and Japan are nothing to envy, and are likely harmful in the long run.

David Kotok of Cumberland Advisors said that “zero and then negative interest rates have created a monstrosity in Europe,” Politico reported, and Kotok warned that Trump’s desire “to follow Europe into this quagmire would harm every saver, every insurance company, every bank.” Along the same lines, Deutsche Bank CEO Christian Sewing said last month, “In the long run, negative rates ruin the financial system.”

Read the full story at The Fiscal Times & Yahoo News .


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