An interesting new mandate for the Fed…
In December of last year, I speculated that the Fed is playing games with the economy in order to tank it just prior to the 2020 elections. I further speculated that Powell may be doing this in order to ensure that Trump loses the election.
Now, former New York Federal Reserve chief Dudley adds his view that the Federal Reserve Bank has a duty to manage United States politics as well as its economy:
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.