US Treasury's Bessent calls for review of Fed non-monetary policy operations
The Fed's autonomy "is threatened by persistent mandate creep into areas beyond its core mission, provoking justifiable criticism that unnecessarily casts a cloud over the Fed's valuable independence on monetary policy," Bessent said in a post on X.
He called Fed monetary policy "a jewel box" that should be walled off to preserve its independence, which he called a cornerstone of continued U.S. economic growth and stability.
Bessent said a review should be conducted into the Fed's decision to launch a massive renovation project of its headquarters at a time when it is posting operating losses. He did not say who should conduct that review, adding that he has "no knowledge or opinion on the legal basis" for the project.
President Donald Trump has railed repeatedly against Fed Chair Jerome Powell and urged him to resign because of the central bank's reluctance to cut interest rates. In recent days Trump has also taken aim at the $2.5 billion renovation at the Fed's almost 100-year-old Washington headquarters, which has exceeded its budget, suggesting there could be fraud involved and that might be a reason to oust Powell.
A recent Supreme Court opinion has solidified a long-standing interpretation of the law that the Fed chair cannot be fired over policy differences but only "for cause."
The Fed's Board of Governors approved the renovation project, opens new tab in 2017, during Trump's first term, and received design approval from the National Capital Planning Commission in 2020 and 2021.
Speaking with CNBC earlier on Monday, Bessent declined to comment on a report that he had advised Trump not to fire Powell, saying it would be the president's decision.
"If this were the (Federal Aviation Administration) and we were having this many mistakes, we would go back and look at why. Why has this happened?" said Bessent, whom Trump has mentioned as a possible candidate to replace Powell. "All these PhDs over there, I don't know what they do."
Powell last week responded to a Trump administration official's demands for information about cost overruns on the renovation project, saying it was large in scope and involved a number of safety upgrades and hazardous materials removals.
Bessent declined to be drawn on predictions that U.S. financial markets could crash if Powell was ousted.
Powell's term as chair ends in May 2026, although he is due to stay on as a Fed governor through January 2028.
Bessent noted another governor seat will come open in January.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
9 minutes ago
- The Independent
JD Vance met with protests during Nantucket visit
Vice President JD Vance was met with a 'MeowTucket' protest in Nantucket, Massachusetts, while headlining a Republican fundraising dinner. The protest, heavily promoted by the Instagram account catsonacouch, aimed to disrupt Vance's visit and mock him using cat-related memes and references. Protesters displayed poster-sized meme photos of Vance, set up inflatable couches, and wore cat paraphernalia, referencing his childless cat lady comment and a fictitious rumor. As Vance's motorcade drove by, crowds yelled 'fascist' and held signs with phrases such as 'fascists not welcome.' Vance's brief time on the island was for a Republican National Committee fundraiser, which reportedly raised $3 million.
The Independent
9 minutes ago
- The Independent
Hershey raising the price of candy bars due to cocoa shortage
Your favorite chocolate bar will soon come with a bigger price tag after Hershey announced it was raising the price of its candy over the high cost of cocoa. Hershey is expected to raise its prices for retail customers by double digits. Prices will generally increase between the low teens and 20 percent, The Wall Street Journal reported Tuesday, citing a company official. But the WSJ reports three-quarters of the candy maker's products should continue to cost $4 or less. Hershey executives have said demand for its products has remained strong, per the WSJ. The company has yet to see its full profits for the summer, when consumers are inclined to grab a pack of Hershey's bars for S'mores by the fire. High cocoa costs are to blame for the price increases at Hershey and other treat companies. Last December, cocoa prices hit over $12,000 per metric ton, according to the WSJ. While costs have fallen to about $8,100 per metric ton this week, they still exceed historic levels. West Africa, which accounts for about 70 percent of the world's cocoa supply, has been hit with poor weather, plant disease, aging tree stocks and destructive small-scale gold mining. While weather conditions have slightly improved, industry sources told Reuters earlier this month West Africa will likely see another 10 percent decline in cocoa output in the 2025 to 2026 season. The WSJ reported in another recent article Swiss chocolatier Lindt & Spruengli had attempted to pass rising cocoa costs onto consumers through price hikes, but even that wasn't enough to make up for the higher cocoa costs.
The Independent
9 minutes ago
- The Independent
Senate even more afraid of Trump-Epstein fallout than Mike Johnson's House is: ‘We've got enough to do'
The House of Representatives broke for August recess a day earlier than expected on Wednesday after Speaker Mike Johnson shut the doors to block moves from Democrats seeking to disclose government files on sex-trafficking financier Jeffrey Epstein. Johnson had a very specific reason to dismiss the House early — a bipartisan discharge petition, which would allow them to force a vote on the release. 'I think it is to sort of try to let the air out of the balloon on the Epstein issue,' Rep. Thomas Massie (R-KY), who teamed up with California Democratic Rep. Ro Khanna on the effort, told The Independent. But if Johnson and House GOP leadership feared the end result of that discharge petition, the Senate does not want to deal with it at all. 'I hope we don't waste our time on that,' said Sen. John Cornyn. 'We've got enough to do,' the Texas Republican told The Independent Wednesday. Cornyn is not entirely wrong. Over the weekend, President Donald Trump said that he wanted the Senate to cancel its August recess to confirm his nominees. The Senate also needs to begin to tee-up the spending bills to avoid a government shutdown in September. The Senate typically sees the House as childish and full of petty grievances. But there's another reason Cornyn, who sits on the Senate Judiciary Committee, specifically would not want to be in the Trump-Epstein blast radius: he faces a potentially bruising primary challenge against Texas Attorney General Ken Paxton, a hardline — albeit scandal-ridden — MAGA candidate. Any harsh questioning or a vote for the files would likely imperil Cornyn's reelection bid. But he's not the only Republican senator dodging the issue. Sen. Chuck Grassley, the chairman of the Judiciary Committee, noted that the Judiciary Committee brings the U.S. attorney general to testify annually. 'Now that, maybe that's not going to happen before September, so we're going to have these Epstein files,' he told The Independent. Grassley said he didn't know the next steps the courts would take, but the disclosures might lead to questions from the committee. On Wednesday, judges in Florida and New York rejected Department of Justice requests at the urging of Trump to unseal grand jury transcripts tied to Epstein, who was found dead by hanging in his New York City jail cell in 2019, in what has been ruled a suicide. This came after Trump had requested AG Pam Bondi unseal them after a Wall Street Journal report that he allegedly sent a bawdy hand-drawn message to Epstein for his 50th birthday party, a report Trump has denied and over which he filed a $10 billon lawsuit against the WSJ, parent company News Corp and founder Rupert Murdoch. Sen. Josh Hawley (R-MO), another member of the Judiciary Committee, expressed some openness to having convicted Epstein accomplice, Ghislaine Maxwell — who is serving a 20-year federal prison sentence for grooming girls and young women to be trafficked by her on-and-off boyfriend — testify before Congress. 'Whatever the bottom line is, I'm in favor of releasing it. So I think that, you know, DOJ ought to release everything that they possibly can, and I'm all for having Maxwell testify,' Hawley said. Hawley, a Yale-educated lawyer and archconservative, also suggested a joint committee made up of House members and senators. One of the few senators who has kept an eye on Epstein is Sen. Tim Kaine (D-VA). In 2017, Kaine grilled Alex Acosta, Trump's then-nominee to be labor secretary, about the time he was the U.S. Attorney for the Southern District of Florida and gave Epstein a lenient plea deal in 2008. Under the 2008 non-prosecution agreement, Epstein pleaded guilty to state charges in Florida of soliciting and procuring a minor for prostitution. That allowed him to avert a possible life sentence, instead serving 13 months in a work-release program. 'Why was the sweetheart deal cut? I never understood that, and I never understood why President Trump nominated the guy who cut the sweetheart deal to be his cabinet secretary,' Kaine told The Independent. Kaine, who was Hillary Clinton's running mate against Trump in 2016, also expressed openness to Hawley's idea of a joint committee. 'I think a white House can shorten circuit, all that by just doing what they've said they're going to do, and releasing the files,' he said. Unsurprisingly, Republican Trump antagonist Sen. Thom Tillis of North carolina, who announced he would not seek re-election and told The Independent last week that the administration should 'release the damn files' said he wanted to see more. 'There was much made about it,' he told The Independent. 'So one of two things are true, not so much should be made of it. Or there things that we should probably know, as long as it doesn't harm the privacy of victims, people that are not actually involved in the investigation.' For now, the Senate will not have to worry about that, given the House is out. But it will be a looming question when the House returns.
