It appears the former head of the New York Fed thinks Jay Powell should stop worrying about this economic expansion and start worrying about being such a pussy.
In an op-ed on Bloomberg today, Bill Dudley takes the rather avant garde stance that Jay Powell needs to stand up to his bully, The President of the United States, by destroying the thing that he's supposed to safeguard, the economy of the United States.
U.S. President Donald Trump’s trade war with China keeps undermining the confidence of businesses and consumers, worsening the economic outlook. This manufactured disaster-in-the-making presents the Federal Reserve with a dilemma: Should it mitigate the damage by providing offsetting stimulus, or refuse to play along?
If the ultimate goal is a healthy economy, the Fed should seriously consider the latter approach.
Dudley goes on to describe how this would work, and it's all quite batshit, but the best part of the column is the end, in which Dudley rather shows his ass by urging Powell to stop showing his:
I understand and support Fed officials’ desire to remain apolitical. But Trump’s ongoing attacks on Powell and on the institution have made that untenable. Central bank officials face a choice: enable the Trump administration to continue down a disastrous path of trade war escalation, or send a clear signal that if the administration does so, the president, not the Fed, will bear the risks — including the risk of losing the next election.
There’s even an argument that the election itself falls within the Fed’s purview. After all, Trump’s reelection arguably presents a threat to the U.S. and global economy, to the Fed’s independence and its ability to achieve its employment and inflation objectives. If the goal of monetary policy is to achieve the best long-term economic outcome, then Fed officials should consider how their decisions will affect the political outcome in 2020.
So, instead of a "data-driven policy that will move to support economic expansion," Bill Dudley is recommending a new Federal Reserve monetary policy of "Hey, Dipdhit Donald, nice economy you got here, be a shame if anything happened to it before November 3rd, 2020."
You know what? We like it.
The Fed Shouldn’t Enable Donald Trump [Bloomberg]