Submitted by QTR's Fringe Finance

Just a quick note on Monday morning’s trading and the politics behind it.

Trump has come out and attacked Chair Powell again this morning for not lowering interest rates. As detailed here, I’m not really sure dropping rates would be “good news” to begin with, but I digress from that point.

I see both sides of this argument: Trump thinks Powell is playing politics (more on that case here) and Powell is trying to protect his independence and go based on data. Personally, I actually don’t mind Powell. I don’t think he’s doing nearly as bad of a job as Yellen did. To the extent he can, he has tried to hold the line to fight inflation (the inflation the Fed created in the first place).

But I'm not sure Trump understands that the sacrosanct (supposed) nature of the Fed being politically independent is part of the bedrock of trust people have in the U.S. financial system.

Trump may think he is doing the right thing by going after Powell for rate cuts to try and stop a market slide but all it's doing is sewing doubt in the U.S. system as a whole - reflected by the market's further volatility this morning and what appears to be continued flight from USD assets.

If Trump were actually to oust Powell, my guess is it would be extremely bullish for gold, silver, bitcoin, etc. and extremely net negative for the USD and the US as a whole. The idea that Trump may have overridden what independence the Fed has left will usurp any gains that lower rates will catalyze in the market.

His strategy of attacking Powell may not be terrible if the U.S. was on better footing globally, but doing it a couple weeks into a trend of what appears to be everybody dumping USD denominated assets is shaky ground, if you ask me.

You all know I don’t think the Keynesian/MMT system makes sense. But even from inside that snow globe, there are some rules that feel...(READ THIS FULL NOTE HERE).