Fed rebuts Trump's claims that policy is hurting the economy
The Federal Reserve is rebutting President Donald Trump's assertion that tightening monetary policy is hurting the economy.
In a paper published Friday, the St. Louis Fed said the central bank's move to reduce the level of bonds on its balance sheet — "quantitative tightening" as it has become known — will not have any noticeable negative impact on growth.
That runs directly counter to Trump's assertion the same day that the policy normalization process has "really slowed us down."
"It is true that removing unusual monetary accommodation will likely result in less real activity and lower prices than otherwise, but the ongoing shrinkage of the Fed's balance sheet was not responsible for bearish asset markets in 2018, nor is it likely to significantly retard activity going forward," Fed economist Christopher J. Neely wrote.
The Fed has been allowing up to $50 billion a month in Treasurys and mortgage-backed securities to roll off what had once been a $4.5 trillion balance sheet. However, the central bank announced in March that it would begin tapering the reduction in May and virtually end it altogether in September, after likely reducing the holdings by barely $1 trillion.
Trump not only called for the end of 'QT' but also said the Fed should consider another round of easing like it did in three stages during and after the financial crisis.
https://www.msn.com/en-us/money/markets/fed-rebuts-trumps-claims-that-policy-is-hurting-the-economy/ar-BBVJHYx?li=BBnbfcN
I don't want someone with multiple bankruptcies fucking with the economy.