Ad hominem attack on Fed Chair Jerome Powell

Investment Analysis Clubs Macro Economic Trends and Risks
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Anyone who has studied debate and persuasion recognized the ad hominem attack as an invalid form of reasoning.

Everybody knows this so the juvenile insults, nasty nicknames and bullying that President Trump are hurling at Fed Chair Jerome Powell only undermine Trump’s credibility. Powell has managed the economic soft landing better than anyone expected so his credibility is strong.

Donald Trump on Truth Social reported by ABC News’ Zunaira Zaki

“‘Preemptive Cuts’” in Interest Rates are being called for by many," Trump wrote Monday. "With Energy Costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other ‘things’ trending down, there is virtually No Inflation.

“With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” Trump continued. “Europe has already “lowered” seven times. Powell has always been ‘To Late.’” [end quote] Note that Trump can’t even spell correctly.

https://www.wsj.com/economy/central-banking/trump-powell-fed-interest-rate-48ced029

Trump Renews Call for Rate Cut, Slams Fed Chair

President hinted last week that he might look to fire Jerome Powell

By Nick Timiraos, The Wall Street Journal, April 21, 2025

…

While Trump regularly made similar threats against the Fed in 2019 and 2020, investors view the current situation as different for two main reasons. First, Trump has been far more willing to defy institutional and legal norms than in his first term. The Republican-led Senate has fewer defenders of those norms than it did then.

Second, inflation could be a bigger problem this year because Trump’s tariffs are much larger and broader than those he imposed in his first term. That is threatening a more difficult trade-off for the Fed, which in recent years lifted interest rates to a two-decade high to fight inflation.

Concerns that the Fed might not be allowed to set interest rates to contain inflation, as it was able to do in 2022, could increase recent skepticism about U.S. economic-policymaking by foreign investors. [and domestic investors, too. --W]… [end quote]

If Trump thinks he can calm the markets by insulting and threatening Jerome Powell he is playing to the wrong audience. Investors have real money riding on the economy. They aren’t ideologues in red baseball caps.

Wendy

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Which would beg the question what the real motivation might be.

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It’s not “motivation”. It’s character flaw, or if you prefer, “disease”.

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Total personal power. Everything he does should be viewed through lens of increasing his power over everything.

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That’s not his audience. His audience is his base, which accepts whatever he says–no matter how absurd–without question.

He does not want an autonomous Fed. He wants to rally his supporters to destroy the Fed. Hence the bombastic tone of comments.

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Dear Wendy,

Every ounce of this is trying to blame Powell for all of Trump’s economic failures. Those failures are going to get a lot worse.

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“ad honimem” attacks are the mother’s milk of Fox Noise. I have mentioned, from time to time, seeing Jack Kemp interviewed by Sean Hannity, a number of years ago. Hannity was doing his usual blowhard bit, and Kemp cut him off with “I’m not here to make ad hominem attacks”.

Nevertheless, character assassination has been Fox’s MO, for decades. Same with Rush. And they command the loyal obedience of millions.

Steve

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The big problem is if Powell is forced out, the market is going to have a problem. Just how far will it drop? A lot of uncertainty out there.

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Trump blinks.

“I have no intention of firing him,” Trump told reporters in the Oval Office on Tuesday. “I would like to see him be a little more active in terms of his idea to lower interest rates,” he added.

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Stampede the market down, stampede the market back up. Wash, rise, repeat. Being exempt from criminal prosecution is great, isn’t it?

Steve

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I think the big problem is that the President has no power to remove the Fed Chair unless there has been some kind of malfeasance in office. The President disagreeing with the Fed Chair on some policy issue is not something that gives the President the power to remove the Chair. And as far as I know, Powell hasn’t been accused any offense that would give rise to that power.

–Peter

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It didn’t stop him from firing people off the labor board who are fighting it in court.

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More significantly, even if removed as the Chair, Powell would remain a member of the Fed and there is no indication that they would vote any differently - and potentially could vote to spite Trump for his interference.

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What makes you think he would allow him to stay on the Fed. Like I said, He fired 2 people that were on the Labor Board. Those people were in positions that were supposed to be free from firing. People do not understand this but People in power have no problem breaking the law, and then making people fight to get reperations. Trumps base has no problem with him breaking the law either.

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I base it on the following (one of a few sources on this topic):

https://www.reuters.com/world/us/whats-known-about-whether-trump-can-fire-powell-fed-2025-04-22/

WHAT WOULD FIRING POWELL MEAN IN PRACTICAL TERMS?

A lot would hinge on just how Trump might choose to “fire” the Fed chief.

As each of his predecessors has done, Powell holds three roles - chair of the Federal Reserve System, member of the Board of Governors and chair of the Fed’s interest-rate-setting Federal Open Market Committee.

Were Trump to try to remove Powell only as chair of the Fed system, Powell could remain a governor until that term expires at the end of January 2028. The next scheduled board vacancy does not occur until January 2026, which in the meantime would leave Trump only the option of nominating one of the other incumbent governors to be chair. Two of those other six were appointed by Trump in his first term - governors Christopher Waller and Michelle Bowman, whom Trump recently nominated as vice chair for bank oversight. Both, like Powell, have spoken about the importance of Fed independence, so it’s not clear that either immediately would deliver the rate cuts Trump wants.

WHAT ABOUT REMOVING HIM AS FOMC HEAD?

Trump has no direct control over who heads the FOMC. The FOMC chair is chosen annually by the panel’s 12 members - the seven governors, the president of the Federal Reserve Bank of New York and four of the other regional bank presidents, who serve on the panel on a rotating basis.

By tradition the FOMC chooses the Fed chair as its head, with the New York Fed president as its vice chair. In theory, though, they could choose any of the members, including Powell should he still be a governor.

… OR AS A GOVERNOR?

Removing Powell as a governor would have the largest impact. Were it to withstand legal challenge, it would give Trump both a board vacancy and chair vacancy to fill with a nominee of his own choosing. Also it would open the door to Trump firing as many of the other governors as he pleased to install a wider Fed leadership he saw as compliant with his wishes.

I don’t think SCOTUS would rule in favor of allowing POTUS to fire every single governor (which is what they would HAVE TO DO if they allow him to fire any governor) as it would be a terrible precedent established for any future president.

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Read this.

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I am aware - but a stay is not the same as a final ruling. If they do rule that he can terminate them with fictional cause, then I will certainly change my opinion.

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Especially if the cause is “cause I don’t want him.”

Pete

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It’s not just a stay, it’s a sign of courts that are in disarray. Back and forth, back and forth.

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Meh. This is how they work. We saw the same thing with ACA. There was dozens of court cases at various levels before SCOTUS ruled (I think multiple times). The process is messy - probably by design.