Trump Threatens Secondary Tariffs of 100% on Russia
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Yahoo
19 minutes ago
- Yahoo
Trump says 'not planning' fire Fed Chair Powell after reports suggest Powell ouster coming 'soon'
President Trump on Wednesday tempered reports from earlier in the day that suggested he planned imminently to fire Federal Reserve Chair Jerome Powell, the latest twist in the ongoing saga regarding Trump's displeasure with the central bank head. Speaking to reporters in the Oval Office late Wednesday morning, Trump said he is "not planning" to fire Powell, though reiterated his view that rates should be lower and the Fed chair is doing a "terrible job." Trump's comments came just about an hour after a slew of reports suggested the president was inching closer to firing Powell. Bloomberg reported that the president was likely to remove Powell "soon," quoting a White House official, and CBS News reported that Trump indicated to lawmakers he would do so while polling House GOP members Tuesday night about whether he should go through with it. The New York Times reported that Trump even showed those lawmakers a draft of a Powell firing letter in the Oval Office Tuesday night. But Bloomberg and The New York Times also both noted in their reports that Trump has not made a final decision. Following Trump's comments on Wednesday, markets erased some of the losses suffered after the initial reports Trump would fire Powell in short order. Trump also said Wednesday he had not drafted a letter regarding Powell's firing. These signals of a possible firing come after Trump on Tuesday told reporters that Powell's handling of a $2.5 billion renovation of the Federal Reserve headquarters 'sort of is' a fireable offense. Any final move by the president to oust the Fed chair could lead to a legal war with Powell, who has argued he can't be removed by law. The president also appeared in his latest comments to narrow his choices to replace Powell. Treasury Secretary Scott Bessent is an "option," but not the top choice, 'because I like the job he is doing,' he said. The Washington Post and Bloomberg reported this week that National Economic Council Director Kevin Hassett is rising as an early front-runner in the race to replace Powell, although former Fed governor Kevin Warsh is also under consideration. Fed governor Christopher Waller is another possibility. Bessent, though, is 'probably not that much of an option," Trump said Tuesday, citing what he views as his good performance as Treasury secretary. "He's a very soothing force." Trump has been hammering Powell for months over what Trump viewed as a refusal to ease monetary policy for political and personal reasons, referring to Powell publicly as 'dumb,' a numbskull,' a 'stubborn mule,' 'stupid,' a 'moron,' and a 'fool.' Trump nominated Powell for the Fed chair seat during his first administration, and his current term is scheduled to run until May of 2026. Read more: How much control does the president have over the Fed and interest rates? Trump's allies in recent weeks have used another tactic to turn up the pressure on Powell: They have invoked a $2.5 billion renovation of the Fed's headquarters as a way to question the chair's management of the institution and whether he told Congress the truth about the project during testimony in June. Trump said Tuesday that "the one thing I wouldn't have guessed is he would be spending two and a half million dollars to build a little extension onto the Fed." When asked if it was a fireable offense, Trump said, "I think it sort of is, because if you look at his testimony ... he's not talking about the problem. It's a big problem." One House Republican, Florida Rep. Anna Paulina Luna, posted on X Tuesday night: "Hearing Jerome Powell is getting fired! From a very serious source" and later added: "I'm 99% sure firing is imminent." CBS also reported that some members of the House Financial Services Committee, which acts as oversight for the Fed, were planning to meet with Powell on Wednesday night, and that some want to reinforce his independence. Top administration officials have sent mixed signals about how far Trump would go with Powell. Hassett said Sunday on ABC News's "This Week" that whether the president has the legal authority to fire Powell before his term is up next May "is being looked into" and that "certainly, if there's cause, he does." But Treasury Secretary Scott Bessent told Bloomberg Tuesday that the president "said numerous times he's not going to fire Jay Powell" and compared Trump's public pressure to former college basketball coach Bobby Knight "working the refs." "President Trump seems to prefer the Bobby Knight school," he said. Bessent also said Tuesday, "there's a formal process that's already starting" to find Powell's replacement. He also hopes Powell decides to leave the Fed board when his term as chair is up. His seat on the Fed Board of Governors is not up until 2028. Trump, too, has sent mixed signals in recent months about whether he would seek to remove Powell, musing about it publicly before assuring he wouldn't do it. Wall Street is paying close attention to the drama unfolding in Washington, D.C. JPMorgan Chase (JPM) CEO Jamie Dimon said Tuesday that the independence of the Federal Reserve is "absolutely critical" and warned that "playing around with the Fed can often have adverse consequences." A firing by Trump could potentially open a new legal war with Powell, who has argued that his removal is 'not permitted by law.' The only language in law pertaining specifically to the removal of Fed board members can be found in Section 10 of the Federal Reserve Act. The law states that each member of the board shall hold office for 14 years "unless sooner removed for cause by the President." The statute doesn't have any language that specifically addresses the chair of the Board of Governors, nor does it detail what exactly constitutes "for cause." The term has been interpreted in legal rulings to mean "inefficiency, neglect of duty, or malfeasance." But Powell and the Fed could still have the backing of the Supreme Court, which made it clear in a May decision it might protect the central bank even as it allowed Trump to fire the board members of two other independent agencies: the National Labor Relations Board and the Merit Systems Protection Board. The central bank, the court said, 'is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States.' What Trump is trying to challenge is a 90-year-old Supreme Court precedent limiting the power of the president to dismiss independent agency board members except in cases of neglect or malfeasance. If that precedent eventually falls, a Powell firing may be easier to legally justify at the Fed. Click here for in-depth analysis of the latest stock market news and events moving stock prices
Yahoo
19 minutes ago
- Yahoo
Hassett grabs pole position in race to be Trump's new Fed Chair
(Bloomberg) — Kevin Hassett, one of President Donald Trump's longest-serving economic aides, is the early frontrunner to replace Jerome Powell as Federal Reserve chief next year, according to people familiar with the process. Hassett, director of the National Economic Council, and Kevin Warsh are the top two contenders in an Apprentice-like contest run by Trump out of the White House. Treasury Secretary Scott Bessent is advising on selection — but could get the job himself if others fail to impress — while Fed governor Christopher Waller remains the dark horse, said people familiar with the deliberations. Trump has raised the succession stakes by routinely blasting Powell for keeping interest rates too high, and saying he'll pick a Fed chair who wants to cut them. It's left investors worried that the central bank's autonomy from political pressure — key to its ability to fight inflation and support the dollar — is in growing danger. Hassett has echoed Trump's Fed critique. In a Fox Business interview this month he noted that the central bank is an independent agency. But he said that by cutting rates before last year's presidential election — and then keeping them on hold more recently, citing inflation risk from tariffs – it deserved the president's barbs. 'I think that that raises the specter that they're not being non-partisan, they're not being independent,' Hassett said. 'There to Serve' Once seen as a measured right-leaning economist, aligned with politicians like Mitt Romney, Hassett has been in the Trump orbit for close to a decade now. He's approached the National Economic Council job very differently from predecessors like Gary Cohn, who sought to damp down the president's impulses on tariffs – and didn't last long. Hassett has gone full MAGA instead – amplifying Trump's instincts on trade, taxes, inflation or the Fed, in myriad TV appearances. That's what it takes in Trumpworld, according to Stephen Myrow, who runs Beacon Policy Advisers, a Washington research firm. 'Anyone who has survived this long under Trump, they're not coming in with an ideology that they want to advance,' Myrow said. 'They're not there to serve a school of monetary thought. They're there to serve Trump.' What remains to be seen is how that service ethos applies to the next Fed chair – a job that's supposed to be walled off from administration priorities. It's a multi-trillion-dollar question. Economists say autonomous central banks are better at taming inflation, so a Fed chief seen as acquiescent to the White House could trigger a slump in Treasury markets. Trump's threats to fire Powell have added to financial jitters set off by his trade war. The president has taken the opposite tack, arguing that excessive Fed rates add hundreds of billions a year to America's debt service costs. 'Most Qualified Individuals' The process of choosing Powell is officially under way, Bessent told Bloomberg TV on Tuesday. Along with the Treasury chief, the narrow circle of aides involved include White House chief-of-staff Susie Wiles – who's advised on Trump's key hiring decisions, and is steeped in the politics of trying to ensure the US economy is thriving by next year's midterm election. Trump allies say the president is deeply engaged in the choice. One adviser predicted the interview process would move quickly, since the president tends to act once he gets an idea in his head. Hassett has been telling people both inside and outside the administration that he very much wants the job — though he plays it coy when asked on TV. Hassett did not respond to requests for comment. Trump, asked by reporters on Tuesday if Bessent is the No. 1 contender to lead the Fed said that he is 'an option' and complimented the Treasury secretary for 'the job he's doing.' 'With Joe Biden's inflation crisis firmly past us, President Trump has been clear about the need for the Federal Reserve's monetary policy to complement the administration's pro-growth agenda,' said White House spokesman Kush Desai. 'He will continue to nominate the most qualified individuals who can best serve the American people.' As NEC chief, Hassett benefits from daily proximity to the president, with an office in the West Wing. Warsh by contrast, spends much of his time shuttling between the Hoover Institution in California and New York City. Trump interviewed Warsh — a former Fed governor — for the chair role in 2017, but opted for Powell instead because he thought Warsh's views were too hawkish and he looked too young for the job. Hassett served as the head of the Council of Economic Advisers during Trump's first term. His earlier career includes stints as a Fed economist and at the American Enterprise Institute, where he was director of research. Hassett is known as an expert on tax, and has written widely on the topic. But perhaps his most notorious book was 'Dow 36,000,' predicting a surge in the US stock market, which was published shortly before the dotcom bubble burst. The Dow eventually hit the level predicted in his title more than two decades later. 'Very Confusing' During Trump's years in exile in Florida between his first and second terms, Hassett – who was doing some work for Jared Kushner's investment fund Affinity Partners at the time — also frequently got together with Trump to talk through economic ideas. Both men share a similar approach to the world and a tendency to store up grievances based on perceived slights, said one longtime friend of Hassett. Trump has been voicing grievances with Powell almost ever since naming him to the top Fed job. Complaints have escalated into open anger during Trump's second term, when he nicknamed Powell 'Too Late' and often resorted to harsher insults. Powell's Fed has kept interest rates unchanged this year, after lowering them by a percentage point over the last few months of 2024. US central bankers say there's no rush to cut further, pointing to solid growth and a healthy job market, and arguing that they need time to see whether tariffs will boost inflation, like most economists expect. So far, consumer prices haven't seen much of a tariff jump – though there were signs in the June numbers, published on Tuesday, that companies are beginning to pass on trade-related costs. That's reinforced expectations that the Fed will stand pat again at its next rates meeting on July 29-30. Markets still expect a couple of cuts by year-end. Echoing Trump's 'too late' jibe, Hassett accused the Fed in his Fox interview of 'falling behind the curve' compared to what other central banks are doing. In another interview with Fox Business on Wednesday, Hassett suggested the Fed had strayed from the 'normal correlation' between policy rates in the US and in Europe, arguing that provided more evidence the US central bank was too slow in cutting. He's also joined other Trump aides and Republican lawmakers in voicing alarm about the rising costs of the Fed's headquarter renovations – which has become the president's latest stick to beat Powell with. One goal may be to pressure Powell to leave the Fed board when his tenure as chair ends in May next year — rather than staying on in the role of governor, where his term extends into 2028. The administration's argument is essentially that Trump's Fed pick — whether it's Hassett or someone else — needs a clear run at the job. 'Traditionally, the Fed chair also steps down as a governor,' Bessent told Bloomberg TV on Tuesday. 'There's been a lot of talk of a shadow Fed chair causing confusion in advance of his or her nomination. And I can tell you, I think it'd be very confusing for the market for a former Fed chair to stay on also.' —With assistance from Charlie Zuza. (Updates with additional Hasset comments in 27th paragraph.) ©2025 Bloomberg L.P.
Yahoo
19 minutes ago
- Yahoo
Carney says US deal that works for Canada isn't on table yet
(Reuters) -Canadian Prime Minister Mark Carney on Wednesday said working through issues related to softwood lumber is a top priority in ongoing trade negotiations with the U.S., but a deal that works for Canadian workers isn't yet on the table. Speaking to reporters in Hamilton, Carney pointed out that U.S. trade deals with other counties are going to involve very high tariffs, but he declined to say what, if any, tariff level would be acceptable for Canada as part of a deal. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
