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Earlier this week, Trump spoke with National Economic Council Director Larry Kudlow. The president had seen a column in the Wall Street Journal, co-written by Moore, with the headline: "The Fed is a threat to growth." Moore argued that "the last major obstacle to staying on this path [of economic growth] is the deflationary monetary policy of the Federal Reserve ".
Trump asked his senior economic adviser when he saw the column. Kudlow replied that he had done it and "liked it a lot".
"Why is not [Moore] the president of the Fed? ", asked Trump rhetorically.
After Kudlow answered that the Fed's board had two openings, the president asked his advisor to talk to Moore about one of the posts. Kudlow asked if Moore was interested and he replied. Trump has proposed to Moore the position of board member of the Fed, which will only become official after being subjected to a verification process.
If Moore sits on the board, he will work with a central bank chief whom he has criticized on several occasions. In a column published in December on the Heritage Foundation website, Moore said Trump was right in saying that rate hikes "would slow down growth and crush the stock market to fight against non-existent inflation."
"What needs to be done now?" Trump wants to dismiss the Fed chairman, though he is doubtful that he has the power. "It's much better for Powell to behave honorably and to admit that his policy has had disastrous economic and financial consequences and resign, "wrote Moore at the time. Trump was not aware of the December editorial, according to the head of the administration.
Moore, 59, has backed Republicans' tax cuts for corporations and most individuals, and advised Trump on tax policy during the 2016 campaign. Critics see some of his opinions As extreme: in a private statement in 2016, he said Trump could try to cut costs by eliminating the departments of Commerce, Energy and Education, among other measures.
Despite Moore's ascent and Trump's skepticism, Powell's work seems safe for the moment. The Fed's indication Wednesday that she will not raise rates this year seems to have eased the president's frustrations.
"Everything is settled," said the manager. "There will be no further rate hike in my life." And the other thing the president wanted was to stop downsizing, and Jay [Powell] announced this yesterday. "
The President's comments on Powell and the Fed's policy raised questions as to whether he respected the central bank's independence. The fact that the administration seems satisfied with the decision to delay further rate increases after months of public pressure by the president will do little to alleviate these concerns.
According to the head of the administration, Powell did not capitulate to Trump on the interest rate policy, but "heard" what the president said. The Fed "made the right choice" after going "too far" in December, increasing its range of target interest rates, the person said.
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