Elon Musk’s Department of Government Efficiency (DOGE) is auditing federal agencies, including a focus on the Federal Reserve, which Musk has long criticized for its monetary policies and alleged overstaffing. Musk asserts that all government entities, especially the Fed, must be transparent and accountable. This audit follows Musk’s previous public statements calling for lower interest rates and questioning the Fed’s employee count, a claim Fed Chair Jerome Powell refuted. A federal judge recently blocked DOGE’s access to Treasury records following a lawsuit.
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President Trump publicly urged immediate interest rate reductions globally, marking a renewed confrontation with the Federal Reserve. His comments, delivered at the World Economic Forum, followed his past criticisms of Fed Chair Jerome Powell and his assertion of influence over monetary policy. While the stock market reacted positively, the Fed has consistently maintained its independence from political pressure. Trump intends to communicate directly with Powell, despite lacking direct statutory control over the central bank.
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Tesla and SpaceX CEO Elon Musk, a vocal supporter of President-elect Donald Trump, has endorsed the idea of allowing presidents to influence Federal Reserve policy, reflecting a growing pressure campaign against the central bank’s independence. This follows President-elect Trump’s repeated calls during his campaign to have a say in Fed policy, a departure from the traditional practice of maintaining the Fed’s autonomy to focus solely on the economic health of the United States. Musk’s agreement with Senator Mike Lee’s call to “#EndtheFed” suggests a potential shift in the relationship between the White House and the Federal Reserve under the new administration, echoing the contentious relationship that existed during Trump’s first term.
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As a casual observer of the financial world, I have been closely following the recent signals from the Federal Reserve regarding interest rate cuts. It seems that many people were anticipating a decrease in rates due to the previous hike, but I believe this assumption was unfounded. The Fed is not going to lower rates just because businesses are dissatisfied; they will do so if they see a need based on the overall state of the economy.
Currently, the economy is still growing, consumers are spending, and unemployment remains low. Despite the interest rate being at 5% or higher, there haven’t been any significant negative effects on the economy.… Continue reading
John Q. Hosedrinker