‘We ain’t seen nothin’ yet’: Expert predicts major ‘market turmoil’ if Trump plan succeeds
Reacting to Donald Trump’s hinting he may attempt to fire Federal Reserve Chair Jerome Powell for not giving in and lowering interest rates in a bid to boost the flagging economy of the U.S., financial expert Edward Luce claimed that would throw more fuel on the financial conflagration he started with his trade war.
Speaking with MSNBC regular Katty Kay, the Financial Times editor was asked about Trump’s Truth Social post Thursday morning along with comments he made to the press later in the day where he said, “If I want him out, he’ll be out of there real fast, believe me. I’m not happy with him.”
Asked by Kay, “Do you think we are inching closer to the point where he might actually fire him? ” Luce responded, “Yes. I mean, remember, he has done this once before in his first term, but that was pre-Covid at a time of market stability and he was pressuring Powell then to cut interest rates.”
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“This time is very different,” he warned. “We’re at a time when the dollar is falling. The dollar is falling when other countries are cutting interest rates, so it should be rising. Why is the dollar falling? The dollar is falling because people, investors, are losing trust in the full faith and credit of the U.S. government under Donald Trump. And if he then adds into this tariff war, which is creating inflation, which of course means you can’t cut interest rates because that’s even more inflationary, if Trump is adding into this a threat to the independence of the fed, the oldest independent central bank in the world going back to 1913, an absolute mainstay of the dollar as the global reserve currency, if Trump in the middle of this it’s going to end the independence of the fed –– he’s going to he’s going to end the dollar as global reserve currency status.”
“I mean, it’s that it’s that significant, these threats that he’s issuing,” he cautioned. “So I think, in amongst sort of all the market turmoil over the tariffs since April, the second since he had his ‘Liberation Day,’ the Fed hasn’t entered the mix until yesterday, and we’re already seeing a flight from the dollar.”
“If he really means this, and I think the Wall Street Journal is correct, that he’s been talking about firing Powell for weeks and months. If he really means this, then we ain’t seen nothing yet in terms of market turmoil,” he added.
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