The Swamp Wins: Trump Expected To Nominate Powell To Replace Yellen

Tyler Durden's picture

Authored by Tho Bishop via The Mises Institute,

In the end Donald Trump will get what he wanted, a “low interest rate person” who also happened to be a “Republican.”

Jerome Powell is expected to replace Janet Yellen in an announcement later this week. If so, this means Trump will ensure that, while the stationary at the Eccles Building will change, the monetary policy guiding it likely will not.

The fact that, in naming Powell, Trump is picking an Obama-appointed Fed Governor for his most important nominations is itself quite fitting. While we have long known that bad monetary policy is bipartisan, Powell’s nomination serves as a particularly useful illustration of how little has changed in Washington since the Bush Administration.

Of course, just as Trump received his loudest applause from Washington for doing his best impersonation of his two predecessors, the President is already being praised for making a “grown up” decision when it comes to the Fed. While his awareness optics likely prevented him from ever truly considering reappointing Janet Yellen –—the preferred choice of the DC and NY — Powell’s nomination ensures that Trump’s scathing criticism of the monetary orthodox has been predictably discarded alongside a number of his most exciting campaign promises.  

Now we will see how else Trump squanders his historic opportunity to rearrange the Fed.

The administration has signaled that its plans to form a policy consensus with its remaining Fed choices - as opposed to opening FOMC meetings into some truly spirited debate.

This likely means that John Allison, whose resume as head of BB&T during the financial crisis and an admirer of Mises and Hayek made him the best fit for Candidate Trump’s rhetoric, is unlikely to be seriously considered for anything. Of course given the dangerous world the Fed finds itself in, it’s likely for the best that Allison emulates the example of Ludwig von Mises who, when offered a prestigious bank position in the 1929, famously said, “a great crash is coming, and I don’t want my name in any way connected with it.”

Going forward, it will be interesting to see how Republicans in the House and Senate proceed. For years now, House Financial Services Committee Chairman Jeb Hensarling has been pushing Fed reform which would have included requiring the Fed to adopted rule-based monetary policy. While this would have complimented the nomination of John Taylor or Kevin Warsh, Powell has made it clear that he opposes such limits being placed on the Fed.

Going forward, we should expect to see the Fed continue its tediously slow normalization of its balance sheet – what George Selgin has cleverly dubbed Operation SNAIL. Whether the Fed continues with its projected interest rate hike in December may itself depend on Congress. The legislature’s knack for kicking the budgetary can down the road as led to yet another “fiscal cliff” scenario at the end of the year.

While we can be ensured that outcome will be more spending (and more debt), the bout of yet another round of arbitrary drama may give the Fed enough of an excuse to follow their lead and hold off until 2018. 


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Quinvarius's picture

No more diaper jokes.  Finance now 10% more boring.

BaBaBouy's picture

It's Raining Paper Fiats (for the .01% ers) . . .

robertsgt40's picture

Someone tell me again how the president gets to select the head of a private corporation.

Winston Churchill's picture

Its a selection from "approved" picks.

To paraphrase Stalin . I care not who votes.I care about who selects the candidates.

D.T.Barnum's picture

moar centrally subsidized malinvestment, just what we needed.

BaBaBouy's picture

Low interest FED Pick ???

Is there any other choice when you have $20 Trill Debt and running almost $1 Trill yearly deficits ???

NugginFuts's picture

Is there any other choice when you have $20 Trill Debt and running almost $1 Trill yearly deficits ???


I dunno, how about default?

skbull44's picture

Once again the voting public has been taken in by a campaigning politician’s promises and rhetoric. Same as it ever was…

MagicHandPuppet's picture

Any suggestions to help remedy a bad case of "Swamp Butt"?

Life of Illusion's picture


Treasuries and MBS , check


Next purchases..stocks , bonds, infrastructure assets, global assets, the world  

nope-1004's picture


"Selecting the next Fed chair..."


LMFAO.  It's a privately run corp that answers to NO ONE!!!!  It's the biggest financial heist of the human population since the middle ages.  This FED is made up of individual bankers who do not answer to anyone and make shit up for their own benefit as they go.

Let's keep the truth out there.


Bes's picture

so how many times does the swamp win

until the trumptards and trumpflakes

see that TRUMP IS THE SWAMP????

it's fucking pathetic


he just has a good twitter game to throw simpletons off the scent.

look  squirrel!!!

Dsyno's picture

"The Swamp Wins: Trump Expected To Nominate Powell"

Newsflash: Every nominee would've caused the swamp to win.

Gorgeous's picture

The money power is not up for drainage.

There is no political will or ability to even control a deficit, much less drain the debt.

TuPhat's picture

So, all important aspects of this aside, we had fun with the Yellen name so what can we do with 'Janet' Powell?

Herd Redirection Committee's picture

Jesuit educated... Jerome H Powell. (of course Trump has his share of Jesuit education and connections as well)

"In 2013, Powell made a speech regarding financial regulation and ending "too big to fail".[15] In April 2017, he took over oversight of the "too big too fail" banks.[16]"

Says it all, really.

"Powell has been a skeptic of round 3 of quantitative easing, initiated in 2012, although he did vote in favor of implementation."

"In 2017, Powell reported that he had a net worth of between $19.7 million and $55 million, making him the richest member of the Federal Reserve Board of Governors.[2][3]"

Donated to McCain in 2008.

"From 1997 to 2005, Powell was a partner at The Carlyle Group, where he founded and led the Industrial Group within the Carlyle U.S. Buyout Fund.[8][12]"

His wife is Elissa Leonard, who works as a Producer in Film and Television.

I am just going to go out on a limb and say there is a lot that screams "CRYPTO!" here.  Of course, Ignatius Loyola, founder of the Jesuits was a crypto-Jew.

Eyes Opened's picture

"In 2017, Powell reported that he had a net worth of between $19.7 million and $55 million, making him the richest member of the Federal Reserve Board of Governors."


So which is it.... $19.7mil or $55mil.... therez a slight difference....

inhibi's picture

Exactly. Does anyone, anyone at all, have any hope that they would actually be fiscally conservative? 

They already tasted the deliciousness of free money. They aint goin back - imagine Them having to work again for a profit, risk their OWN skin, not just watch a stock/put/option/realstate go up or down - which they bought using the free money siphoned to them by the Fed/BB.

This era shouldnt be called the 'Silicon Age' but the 'Silly Age' - a group of chimps dancing around a pile of money, watching a screen of numbers going up and down, while the rest of the world burns around them.

cheka's picture

the federal reserve BOARD is gov.  the banks are private.

is jerome another dual?

Herd Redirection Committee's picture

Crypto, or his wife is crypto, from the looks of it.

Consuelo's picture



I Know...


It doesn't matter - Debt or Deficits.   

In fact, by that now-ubiquitous chart of when all this got rolling, it hasn't mattered a whit since 1983...



Mementoil's picture

A "low interest kind of guy" is going to be "the grownup choice" for a Fed chair, until it won't...
Just wait and see what happens when inflation finally picks up, and the Fed has not intention of fighting it.

By the way - has anyone noticed that crude oil just had a golden cross the other day?
Stagflation, here we come!

evoila's picture

His wikipedia doesn't contain the word Goldman. I guess that's a positive. 

YUNOSELL's picture

and he's looks a lot less reptilian than previous Fed chairs, which is a bonus!!

ali-ali-al-qomfri's picture

But how on earth is he going to fill,

Janets size 2W little slippers?,

I mean he has a corn on this left big toe?

Are all the light switches and door knobs

going to be moved back up to regular height?

These costs should be considered.

Buckaroo Banzai's picture

First goy to run the Federal Reserve since Volcker retired. So there's that.

Antifaschistische's picture

EXACTLY!!   I thought his name would end with ...stein, berg, etc...

it's a start

Consuelo's picture



And a Dutiful one at that - gee, who coulda known...

jewish_master's picture

yes no jew will be dumb enough to be in the chair while it unravels..... we too smart for that. only maens the crash is near. why do u think priest (Cohen) left the race

Anon2017's picture

Good. Now the Jew hater Bach can start blaming the Christians for everything that goes wrong in the economy. I wonder if Bach is a Muslim troll. Or perhaps he works for the Russians trying to stir up dissension in the US.

Salzburg1756's picture

You are dumb!

I speak for Mozart, but I love Bach.

skbull44's picture the new boss, same as the old boss...

NugginFuts's picture

This is simply hilarious. He's always said he wanted a low interest rate person in there. 

The Republicans elected a Democrat. That or it's time to admit your choices don't matter.

Buckaroo Banzai's picture

Considering that raising interest rates will blow up the (((global financial system))), it's kinda hard to blame Trump much for wanting a low interest rate guy.

Anon2017's picture

Richard Nixon also got a low interest rate guy to chair the Fed, bullied him to keep interest rates low and the end result was that the US$ crashed and a few years later inflation soared.

earleflorida's picture

low interest rates = moar borrowing/ moar debt

high interest rates = savings/ less debt

which are we today...[?],

a nation inslaved in debt, or a nation fiscally secure

NOW--- WTF happened to good old fashion compounded interest without going to the casino, per`say!

Antifaschistische's picture

Interest rate policy is not an rnc dnc issue. Any institution with 20 trill in debt can NOT advocate jackng interest rates. We will stay on this track until we are derailed.....did you really vote for trump because you thought Ron Paul would be selected as the Fed Chairman?

Osmium's picture

Meet the new boss, same as the old boss

Nexus789's picture

Shouldn't it be...from approved pricks. 

caconhma's picture

Trump always was a POS, he is POS, and always will be POS.

To expect anything new from an old utterly corrupt and dishonest dog is ridiculous.

Billy the Poet's picture

I continue to be impressed by the naivete of some people around here. It's as if they believe that the American political process is a crucible in which the most qualified and honorable citizens can rise to lead the nation.  Guess what? That's not how it works at all and so if you try to judge Trump or anyone else by that standard then you're going to sound foolish.


PS -- Don't just downvote. Explain why you think that the American political process is or can be as pure as the driven snow.

Bryan's picture

I can't blame them.  It's what the schools have been pushing for a long time.  They certainly do not teach that money begets power begets political positioning.

Billy the Poet's picture

I agree up to a point. It's just a shame that the once in a generation lesson we are receiving in the true nature of the American political system is lost on those who can't muster up any observation more substantial than, "Trump is bad," or "Hillary is bad."

Bryan's picture

True.  The 'Me Generation' as come full circle.  With God out of the way now (and along with that any moral common ground), everyone gets to make their own rules and anyone who doesn't follow them is the enemy. 

Billy the Poet's picture

This atheist agrees. Never thought I'd be sad to see the withering away of organized religion but the void left behind is malignant. Some, like the Unitarians, tried to let the magic go while retaining the morality of religion but not enough folks followed that example.

Most Christian morality is reasonable in my opinion and can stand on that merit alone. That's a personal choice and I have no problem with those who express a more traditional position. But the loss of faith accompanied by the rejection of morality seems like tossing out the baby with the bath water to me.

Anon2017's picture

There is too much money in the election process. The Citizens United decision in 2010 made a bad situation worse. The Supreme Court justices who voted for Citizens United were not atheists. 

Billy the Poet's picture

I don't see 2010 as some bright line in American politics. There also seems to be something amiss about the premise that money has no place in politics despite the fact that politics is almost exclusively a game of redistributing money from some parties to other parties.

If you want to take money out of politics then go all the way and make redistribution illegal.

Eyes Opened's picture

''If you want to take money out of politics then go all the way and make redistribution illegal."


Now you are slingin the baby out with the bath water...

Hillary spent a BILLION dollahs .... think about that for a moment... most went to the media.... put a halt to that & you will see changes.

As for the whole "re-distribution" thing ?? TOTAL TRANSPARENCY will do a lot to see changes here too...


But... we all know it ain't ever gonna fly... turkeys & christmas & all that...