Listen, the Trump White House cannot make it any clearer: President Trump understands and respects the independence of the Federal Reserve.
Isn't that right, Larry Kudlow? Hey, so what if he likes to call the country's central bank "loco" or repeat ad nauseum that appointing Jay Powell to run the Fed was a mistake. And it's not like he's called the fed worse that China...more than once.
What does this White House have to do to prove once and for all that POTUS doesn't have a dark thirst for the Fed?
See, nothing but love, Jay-bee...
And everyone else in the White House is being cool too! The market might not like watching money get less free, but there's a pretty populous school of economic thought right now saying that one more rate nudge in 2018 would perhaps get the stock market back to where Powell thinks it should be, creating a floor for 2019 that would double as a rationale to keep things stable and let traders get all irrationally optimistic again without a precipitous correction hanging metaphysically over their heads. Whatever you might think of it, it's an argument that's definitely out there, along with a few others from a variety of hawks that aren't ready to let the party end. If you're even halfway familiar with basic thinking around monetary policy, you've certainly heard a variety of them and they provide you with possible cover if you don't want to take a side in the Fed rate debate. Like, if you were a White House economic advisor on live television, for instance...
White House advisor Peter Navarro — just hours after President Donald Trump blasted the Federal Reserve — doubled down Monday, singling out the central bank as the biggest threat to U.S. economic growth.
Appearing on CNBC's "Squawk on the Street," Navarro said the Fed should pause its interest rate hikes — not because growth is slowing, but because growth is strong with barely any inflation.
"We have zero inflation for all practical purposes" and strong economic growth, Navarro told CNBC's Rick Santelli. "The only argument I'm hearing for the Fed to raise rates now is somehow they have to exert their independence."
Setting aside the realization that Peter Navarro talking to Rick Santelli about the Fed on CNBC is the finance equivalent of two meth heads arguing about who should host The Oscars in a bus station bathroom stall, let's talk about how hilarious it will be when Larry Kudlow is trotted out onto the White House lawn close to the Opening Bell in order to remind the press that Trump totally respects the Fed's independence. The mixture of Kuddles being unctuously confident and cozy with the press corps while his boss tweets "Lying DEMS using Fed to keep Trump economie from MAking America Great Again! COLLUSION!" and Peter Navarro goes on Lou Dobbs to say that Jay Powell should be arrested for treason, because, economics.
Your move, Mr. Chairman, because the White House is now double-dog daring you to raise rates.