Economy

Cain to Withdraw From Fed Consideration

Cain to Withdraw From Fed Consideration

Four senators from U.S. president Donald Trump's Republican party have said they would vote against one of his potential nominees for the Federal Reserve Board, Herman Cain.

President Donald Trump announced last week his intention to nominate Cain, a political ally and former 2012 Republican presidential front runner.

"When I saw Trump's tweet, the feeling I had is that it increases the odds the Fed tightens this week to assert their independence", said Carl Tannenbaum, chief economist at Northern Trust and a former Fed economist. The chairman told the lawmakers that interest rates are at about the right level given current economic conditions and that the benefits of USA economic growth haven't been as widely spread as the Fed would like. Pelosi said. "The Fed should be determining the rates, not any politicians, and that is a unsafe thing for an economy when the central bank of a country has. political influence".

Representative Ami Bera said Powell talked about the domestic and global economy.

Analysts say Moore has at times sounded like a "hard money" advocate. Both Fed choices have been met with "heavy public scrutiny", said Paul Kiernan, also at the Journal. "But it's obvious now that Trump doesn't like Powell and is trying to appoint people to Powell's board that are the cultural antithesis to Powell". Trump's trade war with China is likely playing a role in worsening the slowdown that was already underway overseas.

While the USA economy looks strong right now, there are signs of a potential slowdown. "We also know that moving too slowly - keeping interest rates too low for too long - could risk other distortions in the form of higher inflation or destabilizing financial imbalances", Powell said on November 28.

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Central bank "capture" by national leaders has been blamed for a variety of economic ills, from hyperinflation to runaway debt used to finance projects in hopes of winning reelection.

Trump has slammed the central bank's rate hikes in 2018 as thwarting economic growth and has publicly pressed policymakers to change course.

The president nominates members to the Fed's seven-member board of governors and Trump elevated Powell to chairman a year ago. We've seen how a responsible Fed board should behave, and it sets the standard the U.S. Senate should expect before approving a nominee: At the height of the financial meltdown in 2008, then-chairman Ben Bernanke made the case to President Bush for a necessary but deeply unpopular bank bailout.

"You don't want to have someone on the Federal Reserve Board who is overly malleable and influenced by the President". "He's not a political person in any way", she said.

"I don't think I've ever really said anything much about the gold [standard]", he insisted.

Kudlow noted the Fed was independent but said that would not stop him and others from weighing in on its activities. "The great thing about the Fed is we have been given independence". "That doesn't mean we can't express our opinions periodically".