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Thank God for the Fed.

 

The Fed just might have saved our economy and next year’s election. All in a single, very under-the-radar, move that you probably heard nothing about.

 

First, why it matters so much.

 

Trump has been destroying the independence, not to mention competence and loyalty to America, of damn near every government institution and agency. All of them. CDC, DOJ, FCC, SEC, VA, EPA, Department of Education, and on down the line. But the Fed has eluded him. His threats toward Fed Chair Powell just bounce off their mark. But…Powell is up for replacement next May. And if Trump can control the Fed the tariff economy-rigging will look like the minor leagues. Trump can just say, “Lower rates to 3.25%,” or “Raise rates to 6.50%,” and, poof, the rates would adjust accordingly.

 

So the economy would be screwed because Trump only serves his own interests, not any of ours. But he could rig the election, too. Just drop rates to almost nothing in September next year to hyper-stimulate the economy, which inevitably leads to high inflation and/or asset bubbles like the tech bubble in 2000 and the real estate bubble in 2008 which both crashed markets. But the crash would come after the election.

 

Here’s what the Fed did last week to, let’s call it Trump-proof the Fed. The Fed’s Board of Governors unanimously voted to reappoint eleven of their twelve regional bank presidents to new five-year terms (the only exception being Atlanta Fed President Raphael Bostic who had already announced his retirement). This would normally be nothing-burger news outside of The Economist because regional bank presidents get reappointed all the time. But here’s why it was key.

 

Crucial really.

 

The terms of all twelve were set to expire in just two months and normally the Fed waits until close to the deadline to take a vote. But they went early and they went on the offensive because the Trump regime just two weeks ago said they would change the rules next year  (shocker, right?) to veto any regional Fed president who had not lived in their district for at least three years. That way Trump would have leverage over a bunch of Board members and Board votes the next five years.

 

What is inspiring is also the fact the vote was unanimous (actual 100%, unlike the Kennedy Center deception) with all three Trump-appointed regional governors voting for the Fed’s political independence. Even Stephen Miran voted for it, after he had previously co-authored a paper calling for sweeping changes to reduce Fed independence, including giving the president at-will power to fire Fed board members.

 

That shows me that some of the intelligent people who were all-in on an all-powerful executive are starting to realize this President isn’t one you want to be all-powerful.

 

Good for Miran. Good for the Fed. And good for all of us.

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