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2025-02-24 Government Corruption
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Federal Reserve remains on hold amid uncertainty over Trump's economic plans
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[Daily Mail, where America gets its news] The Federal Reserve has moved into a near standstill as President Donald Trump continues to rail through and cut government contracts, workforce, programs and even entire agencies.
While much remains up-in-the-air within the federal government, the U.S. central banking system is struck trying to adjust to the fallout in real time as Trump and his 'first buddy' Elon Musk make dramatic changes.
Federal Reserve officials speaking on the matter claim policy is 'well-positioned' to adjust to the risks emerging from swift and sweeping change taking shape at the federal government.
Increasingly, however, post-meeting sentiment appears to be more cautious about the volatility.
President Trump has taken a very aggressive trade stance, announcing over his first month in office intention to apply sanctions and tariffs on multiple partners throughout the world.
He has also been ambitious in his overall economic agenda, forcing agencies, departments and the central bank to remain fluid to what appears to be daily changes that influence policy.
In a blog post made on Thursday, Atalanta's Federal Reserve Bank President Raphael Bostic noted: 'In recent weeks, we've heard not only enthusiasm — particularly from banks, about possible shifts in tax and regulatory policies — but also widespread apprehension about future trade and immigration policy.'
'These crosscurrents inject still more complexity into policymaking,' he added.
Additionally, with the help of Musk, entire agencies are being overhauled and some slashed – including USAID.
Thousands of federal workers have agreed to take the buyout to voluntarily leave their jobs for full pay through September 2025 and billions in government contracts have been canceled at agencies like the Department of Education and National Institutes of Health.
Federal Reserve Chairman Jerome Powell has been meeting with central bank governors and regional presidents in recent weeks amid all the chaotic change.
Chatter is that while the message is about how 'well-positioned' they are to handle the ups and downs, there is increasing anxiety about the rate and level of change happening with spending and policy.
Bostic said that 'uncertainty' is an increasingly common theme among Fed leaders.
The Federal Open Market Committee released minutes from the meeting on January 28 and 29, which included dozens of references to this uncertain climate.
It specifically cited 'elevated uncertainty regarding the scope, timing, and potential economic effects of possible changes to trade, immigration, fiscal, and regulatory policies.'
'Right now, I see the risks of inflation staying above target as skewed to the upside,' St. Louis Fed President Alberto Musalem told reporters on Thursday.
'My baseline scenario is one where inflation continues to converge towards 2 percent, providing monetary policy remains modestly restrictive, and that will take time,' he continued. 'I think there is a potential for inflation to remain high and activity to slow.'
'That's an alternative scenario, not a baseline scenario, but I'm attentive to it.'
The U.S. central bank for the last four years has targeted inflation at 2 percent.
Though Chicago Federal Reserve President Austan Goolsbee is thought to be among the least hawkish on inflation, he remained more measured when it comes to tariff assessments.
'If you're just thinking about tariffs, it depends how many countries are they going to apply to, and how big are they going to be, and the more it looks like a Covid-sized shock, the more nervous you should be,' Goolsbee said during an appearance on CNBC.
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Posted by Skidmark 2025-02-24 01:41||
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File under: Tin Hat Dictators, Presidents for Life, & Kleptocrats
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Posted by Super Hose 2025-02-24 04:43||
2025-02-24 04:43||
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