When Barr left Vice Chair for Supervision, he didn't resign his BoG seat. Powell *could* do same & we don't know his plans; if he doesn't resign BoG, gotta pick from BoG.
It's also wrong to attribute all monetary policy decisions to the Fed Chair. Like, that is not how the FOMC works, it's a committee. The Fed Chair has more power than others to direct it but cannot set policy on his own.
Disagree with this reading. It's very normal for these things to play out well in advance of the actual term ending.
Does that mean Powell is forever safe? No. I just don't read Bessent's statement here to imply anything other than a normal process of picking a new chair.
Announcing this now gives those managing Trump a bone the next time he wants to fire Powell. “I understand your frustration Mr. President, but he’ll be out the door in ‘x’ months.”
Almost a no win situation here for Bessent given the broader context.
I would take pains to clarify this is per the normally scheduled rotation, but even that risks falling victim to "people keep asking about my we're not firing JPow tshirt"
Agree. So process starts early since need confirmation. First, there is an opening in January for a Board Governor. And Jay's replacement needs to come from the Board. So this seems to be the October 2step plan
My point is, how much liquidity do you give a rotten political-economy. (Emperor wears no clothes). This is simple. Why should we give oxygen to a Federal System, the Fed should not front run a liquidity response to madness. Yeah patch it here and there, but no big cuts!
Kugler's term ends in January 2026, so they could fill her spot with a loyalist and then give that loyalist the chair in May, without Powell needing to vacate his spot.
May 2026, so the midterms do not save the Fed…only sanity of the entire economic cult is at stake…I hope these Priests and Priestesses of the Money know their ass from a hole in the ground?
Doesn’t matter. Fed Chair doesn’t set policy by himself, it’s done by committee and Powell can retain his board of governors seat until after the next President takes office (Jan 31, 2028) if wants to, even though his Chair position ends next May.
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Powell is Fed Chair until 5/23/26.
But his Board of Governors term is until 1/31/28.
When Barr left Vice Chair for Supervision, he didn't resign his BoG seat. Powell *could* do same & we don't know his plans; if he doesn't resign BoG, gotta pick from BoG.
Does that mean Powell is forever safe? No. I just don't read Bessent's statement here to imply anything other than a normal process of picking a new chair.
I would take pains to clarify this is per the normally scheduled rotation, but even that risks falling victim to "people keep asking about my we're not firing JPow tshirt"
I'm curious how Biden handled the question.