Economists say Trump’s criticism of Jay Powell misrepresents Fed’s role, influence
By Martha C. White
President Donald Trump leveled criticism against Federal Reserve Chairman Jerome “Jay” Powell in a Washington Post interview when asked this week about the recent streak of stock market losses and the prospect of a recession. Economists say this is, at best, a mischaracterization and, at worst, a deflection of the damage Trump’s own worst impulses have inflicted on the market. …Economists also said Trump overlooked a second key driver of higher interest rates: Bigger deficits. “The tax cuts late last year have sharply increased the federal deficit and that means the Treasury prints more debt,” said Karen Shaw Petrou, managing partner of consulting firm Federal Financial Analytics. “Money moves out of the stock market into the bond market when Treasury prices go up, and the deficit is driving prices up,” she said.