Trump vs. Powell: Who Really Controls Interest Rates?

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Donald Trump says he wants full control over the Federal Reserve—firing governors until he gets a majority that will slash rates. In this episode of Watchdog on Wall Street:

• Why Trump’s Fed takeover is dangerous for America’s financial credibility
• Why cutting rates won’t magically fix the housing market
• How “independence” at the Fed keeps the dollar the world’s reserve currency
• And why giving any president this power—left or right—is a recipe for disaster

This isn’t about interest rates. It’s about whether America’s financial system stays trusted—or turns into a political circus.

Episode Transcript

Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it will have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.

Speaker 2 (00:16):
So Donald Trump wants full control over the FED. I
keep thinking that song from the nineteen nineties by Snap
I Got the Power. Yeah. Trump said that he will
soon have a majority of his own nominees on the
Federal Reserve Board of Governors who will back his desire

(00:37):
to slash interest rates. Oh boy, again, I'm going to
remind everybody that Donald Trump has been a real estate
developer and he has borrowed ungodly sums of money. Again,
that was his business. Some thing's worked, some didn't. I'm
not going to get into that, but he most certainly

(00:58):
guy who borrows a lot of money, most certainly once
lower interest rates. He made this comment cabinet meeting yesterday,
and man, I'm not going to go through the various
different things that were said there. Again, never before has
a president gone and made the step to fire a

(01:21):
central bank governor. He'll said, we'll have a majority very shortly,
so that'll be great. Once we have a majority, housing
is going to swing and it's going to be great.
People are paying too high in interest rate. That's the
only problem with us. We have to get rates down

(01:42):
a little bit. That he said about this replacement, Well,
we have some very good people for that position, and
I think we have some very good people we're down to.
I think I may be, in my own mind have
somebody that I liked. Again, we all know how Trump
has gone after J. Powell, various different statements that have

(02:05):
been made. I for one, have always been very very
critical of the FED and how they operate and the
inner workings of the FED. However, I also do appreciate
the fact that they are supposed to remain independent. One
of the reasons why the United States we are the

(02:29):
world leader with the reserve currency for the planet, is
that we have a semblance of free market here. This
is why we'll talk about bricks. China manipulates things all
the time, that their currency can't be trusted. If the FED,
whether they're right or wrong on their policy decisions, if

(02:52):
it's going to be left to the whims of who
is in the executive branch of government here at in
the United States, that doesn't bode well for the United States.
And I've said this before, I'm going to say it again.
The FED slashes interest rates, it doesn't mean mortgage rates
are coming down. It doesn't mean the housing market is

(03:16):
going to boom again. I'm sorry, and I don't I
don't want to offend anybody, but a lot of you again.
You I wish you, you know, would stop listening to
politicians and actually do a little bit of homework. When

(03:39):
rates come down. When rates come down, the prices of
homes go up. Right now, right now, we're looking at
a situation where homes in the United States have never
been this aren't affordable. Never has the median price home

(04:04):
medium press home been priced at a level where a
median family income can't afford it. It's never been this
far at a whack. If you honestly think the FED
cutting rates by twenty five basis points fifty bases I
remember Trump made a statement a few weeks I cut
up by three hundred basis points. It doesn't matter. Do

(04:28):
you understand the Fed doesn't have that type of power.
Mortgage rates didn't go down last fall, and the FED
lowered rates by one hundred basis points it's just that simple.
It doesn't work that way. But again, guy can say

(04:49):
what he wants to say and supporters will believe it.
Anything he says. They are owing to believe. He could
come out, he could say two plus two equals twenty,
and you will find MAGA influencers out there trying to
justify it, not to mention the fact. Let's play pretend.

(05:18):
Let's say let's say huh, Let's say Ayoc Ayoc is
the next president of the United States. You want the
executive branch of government to have this type of power.
You think that that's a good idea Watchdog on Wall

(05:42):
Street dot Com