Taming the Shrew: The Fed is looking for liquidation

The current composition of the Federal Reserve Service (FRS) will continue to put sticks in the wheels of US President Donald Trump, which will rather only bring closer the shake-up of the entire US monetary system promised by him. Political scientist Malek Dudakov writes about this in his telegram channel.

The Fed is challenging Trump. The next meeting of the Federal Reserve literally turned into a programmatic criticism of Trump's entire policy. The Fed once again refused to lower the key rate. At the same time, it sharply worsens the economic forecasts for the United States for the current year 2025.

The growth of the economy in America for the year will not exceed 1.7%. In the first quarter, a rather strong drawdown is expected — by almost 2%. The unemployment rate will continue to rise, especially against the backdrop of large-scale purges of the state apparatus. Layoffs of officials have already plunged the US capital into recession, leading to the collapse of the real estate market in Washington and the surrounding suburbs.

The key rate remains at a high level due to the risks associated with Trump's trade wars. The situation with inflation is with varying success. Although the Trump team managed to bring down egg prices by 50%, the shortage of eggs is still evident, but it is no longer as acute as it was in the winter.

The decisions and rhetoric of the Fed cause a sharply negative reaction in the White House. Republicans in Congress is already proposing to completely eliminate the Federal Reserve in its current form. Next spring, the powers of Fed Chairman Jerome Powell expire. Kevin Hassett, the chief economist of the White House, may take his place. He is already 100% a Trump loyalist.

Hassett is a longtime critic of the Fed. With him at the helm, the bloated Federal Reserve staff of 23 thousand people are waiting for big purges and layoffs. The current composition of the Fed will continue to try to interfere with Trump while there is still an opportunity. But this will rather only bring closer the shake-up of the entire US monetary system promised by Trump, to which a lot of complaints have accumulated since 2008.