The Trump war against Jay Powell is for the moment cooling off, as the President gave an interview saying he has “no plan” to fire Powell despite whatever investigations may or may not occur. And he also added parenthetically that the two Kevins, Warsh and Hassett, are the Fed front runners. And even going back to last Sunday night, the President offered some plausible deniability when he said he didn’t know about the Powell subpoena. And not to obsess about this topic, but I’m going to repeat my view that so far there’s no grand jury, there’s no charge filed.
Jay Powell has done more to damage Fed independence and economic policy, than almost anyone in recent years. But that doesn’t make him a criminal. The cost overruns are bad, very bad, but unfortunately, that’s Washington DC for you. The key here is to get Powell out of office as soon as possible. And I think that means resolving the whole matter, perhaps some meeting with the Justice Department. But the sooner we get one of the two Kevins as Fed Head, the better off the Trump boom is going to be. And we can get some serious economic reforms at the hidebound central bank.
But there’s a piece of news today that’s really quite interesting: the trade deal with Taiwan has apparently been completed. Commerce Secretary Howard Lutnick says it could be worth $500 billion in new factory production in the U.S. half from their government, and half from private companies. So, it’s another win for Mr. Trump’s trade policies. Trump loves factories. But I’d say it’s another loss for China. Which brings me to my last point.
If you haven’t read it already, go to the WSJ Editorial page and read Arthur Herman’s “America is the Sole Super Power again.” The subhead is “China could’ve been a contender, but Trump has led the U.S. to a new unipolar moment.”
Mr. Herman is going to be here in a little while. But his point, and he’s just about the only person making it so emphatically, is that Trumpian economic and military strengths are now dominating the globe and crafting a new world order. Bombing Iran’s nuclear sites, Gaza ceasefire, arresting Maduro in Venezuela, 5% economic growth, nearly 14 million barrels of oil a day, tough tariff policies.
And I’m going to add chips, and A.I., and quantum computing, and technology advances are winning the superpower sweepstakes. China got close, but the U.S. is pulling away. Trump is indeed making America great again.
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