Kevin Hassett on Calls for Powell to Resign: The Central Bank Has Been Saying That the Tariffs Are Going To Be Inflationary

RUSH TRANSCRIPT:
BARTIROMO: “President Trump continues to put pressure on Federal Reserve chairman Jay Powell to cut interest rates pretty called them to resign and the cabinet meeting there is growing talk about you being a contender as the next Federal Reserve chairman against names like that governor Kevin Warsh. I know you cannot admit or not but let’s go hypothetical, hypothetically speaking if you were the chairman of the Federal Reserve are now would you be cutting interest rates, what would your policy look like.”

HASSETT: “Again and marketable the hypothetical author but I will talk about Federal Reserve policy. “the bottom line” they are very normal correlations between the policy rates for the major trading partners in a high correlation between the central bank of vero policy rate in the American rate. If you look at the normal relationship between the European rates in the U.S. rate, the U.S. rate would be about 8% have lower then it is. You have to ask yourself why is this the normal correlation that we’ve seen over and over again for many years between the actions of the central banks have broken down precisely now and you don’t have to wonder about it. It’s because the central bank has been author saying that the tariffs are good to be inflationary and saying that since President Trump took office. As you and I discussed the tariffs have not been inflationary men as I give economic intuition four months ago when we talked about how we think the Chinese will eat most of the tariffs. “the bottom line” a failed observation of why they think they need to be worried about inflation, the data has spoken against them in their out of whack there in outlier and global financial policy, there’s plenty of room for the Fed to correct that.”