Trump claims Fed Chair Yellen does White House’s bid­ding

The Myanmar Times - - International Business -

US Repub­li­can pres­i­den­tial nom­i­nee Don­ald Trump said Fed­eral Re­serve Chair Janet Yellen was sup­press­ing in­ter­est rates to suit the White House’s po­lit­i­cal agenda.

Speak­ing to CNBC, Mr Trump re­it­er­ated a charge he has made be­fore that Ms Yellen was im­prop­erly main­tain­ing a low fed­eral funds rate to bol­ster Pres­i­dent Barack Obama’s pop­u­lar­ity.

“It’s stay­ing at zero be­cause she’s ob­vi­ously po­lit­i­cal and do­ing what Obama wants her to do. I know that’s not sup­posed to be the way it is but that’s why it’s low,” Mr Trump said.

He al­leged that the Fed was leav­ing the painful task of rais­ing rates to the next pres­i­dent.

“The in­ter­est rates are kept down by Pres­i­dent Obama. I have no doubt that’s the rea­son they are be­ing kept down,” he said.

By statute, the Fed is an in­de­pen­dent body in­tended to be shielded from po­lit­i­cal pres­sure and whose op­er­a­tions are not funded by the US Congress.

Mr Trump also said that low rates were cre­at­ing a “false mar­ket,” adding that stock mar­kets were likely to drop sharply once rates even­tu­ally do go up. He said the long pe­riod of low rates had most hurt re­tire­ment in­vestors who had ex­pected to draw on sav­ings in­ter­est.

“The next pres­i­dent, let him or her raise in­ter­est rates and watch what hap­pens to the stock mar­ket,” Mr Trump said.

“The peo­ple that were hurt the worst are peo­ple that saved their money all their lives and thought they were go­ing to live off their in­ter­est and those peo­ple are get­ting just ab­so­lutely creamed.”

Mr Trump’s re­marks come af­ter US eq­uity mar­kets lost more than 2 per­cent on Septem­ber 9 on fears the Fed will raise rates this month.

The US na­tional debt stood at US$7.6 tril­lion when Mr Obama took of­fice with a sink­ing econ­omy in Jan­uary 2009. It now stands at $19.5 tril­lion. The to­tal per­cent­age change in na­tional debt un­der Mr Obama com­pared to other ad­min­is­tra­tions has been com­par­a­tively mod­est, how­ever. –

Photo: EPA

Janet Yellen is ac­cused of sup­press­ing in­ter­est rates.

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