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Posted on 09/04/2026 7:25:48 AM PDT by Miami Rebel
President Donald Trump on Friday demanded that the Federal Reserve slash interest rates or else he will cut off trade with countries with which the U.S. maintains trade deficits.
Trump issued the sweeping ultimatum in a Truth Social post reacting to a much-stronger-than-expected monthly jobs report by urging the central bank and its chairman, Kevin Warsh, to “get smart” and cut rates.
Read Trump’s full post:
Great jobs number just announced, breaking all estimates (except mine!) by double and triple - And you haven’t seen anything yet! EMPLOYERS ADDED 162,000 JOB IN AUGUST. Lower the interest rates because the U.S.A. is a much stronger credit than it was just a short time ago! A STRONG COUNTRY MEANS A LOWER INTEREST RATE - IT’S A BETTER CREDIT…Very simple! We should have the LOWEST RATE of any country in the World, like “the old days.” Without the United States agreeing to allow them their big surpluses, and we could stop that immediately, they would no longer be considered financially ELITE! LOWER THE RATE OR I’LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT, which the U.S. Supreme Court, in its ridiculous and very costly Tariff decision, strongly acknowledged “the President” has an absolute right to do. IT’S BETTER THAN TARIFFS! The Fed Board, with its great new leader, must get smart - BE PATRIOTS for a change. High interest rates put the U.S.A. at a very unfair disadvantage, and I won’t allow that to happen! President DONALD J. TRUMP
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The Federal Reserve exists for the single purpose of transferring wealth from the middle class to big banks and wall street. They are not our friend. That’s why the Federal Reserve was created in secret at midnight on Jekyll Island. A black swan event.
Nothing personal but I trust Trump over some all-knowing, hand-wringing, nattering nabob of negativism FReeper.
So many surface based comments. Trump’s message is meant for at east 5 different levers.
First, on the obvious one is the Fed. He knows a strong job report puts presure on raising rates. Trumps negotiating style is to always ask more than what he wants. Demanding a decrease may be his way of stopping an increase.
Second, he is also telling the Fed that the president has significant control over supply chains and that gives him a lever over inflation also. If they want to attack inflation, they need to talk with Trump to have a comprehensive approach.
Third, he is negotiating trade deals like Canada. He sends them a signal that he has power beyond tarrifs if a deal cannot be made and he claims he has motives beyond a mutual good trade deal.
Fouth, on the political front he is trying to lower costs to buy homes, cars, etc.
Fifth, on the unfinished court arguments over how much control he has over tarrifs, this sends a signal that he is willing to go to an all or nothing end gain.
So many surface based comments. Trump’s message is meant for at east 5 different levers.
1. He has no negotiating leverage. The Fed isn’t going to set a meeting with Bessent to hammer out their differences. Rates aren’t set based on negotiations.
2. The threat of destroying supply chains is nonsensical. The Fed won’t react to it. If indeed he defies common sense and makes us spiral into recession, then he might just get his wish of lowered rates.
3. Canada doesn’t discount his power or rage. He’s expressed them repeatedly for over a year. Barring Canadian aluminum and lumber destroys American industries. Halting trade would shut down our auto industry overnight. That’s over a million US manufacturing jobs. And beyond all that, Canada has no influence on the Fed. Scaring Canada won’t lead to easing rates.
4. For reasons stated above (see #4,) it would have the opposite effect.
5. So who’s he trying to influence? The USSC or the Fed?
Profits rising is a pro-rate-hike signal only in one specific sense If “profits are rising” is occurring alongside: rising inflation or inflation expectations, and rapid credit growth / speculative excess, then it can be consistent with higher nominal rates (because lenders require compensation for inflation risk and capital is in heavy demand). But if profits are rising mainly from productivity gains and inflation is contained, rates don’t “have to” rise.
Check it more of a TDS issue they answer to many other people too.
This is about stealing from people who saved all of there lives. Not allowing them to get a decent return on their money. Or force them to put it all at risk in the casino wall street system. Bankers and the politicians that work for them always want to force peoples savings into the system where they can manipulate it for even a greater gain.
“ President Donald Trump on Friday demanded that the Federal Reserve slash interest rates or else he will cut off trade with countries with which the U.S. maintains trade deficits”
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American businesses that depend upon imports from China would be wise to seek other sources… including domestic American sources,
Sixth, demanding lower interest rates—he is willing to penalize retirees on a fixed income, needing investment income—to accomplish those five.
Yeah, great.
Meanwhile, it’ll take years to develop those alternative sources.
,,,,,,,ref. retiree CDs, savings accounts, bonds, and all other fixed interest rate investments/savings.
Employment goes up, the economy heats up, and will even more if these terrible oil and product prices ever go down again and he wants to raise rates from what is a modest and reasonable level as they are now? I think he has lost another piece of his mind.
Rates are already going up without the FED taking action. Bank margins have to be increasing with that.
How do you know what influences the Fed?
FR is now 80% + TDS posters.
I would say the nuanced message is: “Do not raise interest rates”. Which is more likely than not at the moment, at least according to Fed watchers. There is ZERO percent chance they lower interest rates.
Has he tried renaming it the Trump Reserve? That always fixes things.
By following the Fed for half a century.
Historically there have been two responses to White House pressure:
(1) Ignoring it. This happens 99% of the time. The governors are independent and owe the administration nothing.
(2) Holding rates higher than necessary. This occurs when Fed governors think that a rate slash that immediately follows political pressure would undercut their credibility.
What DOES influence the Fed is data. They are far from perfect when reacting to it, but that’s the input they follow.
The singular occasion when the above didn’t hold true was when Arthur Burns succumbed to pressure from Richard Nixon.
“An analysis of the Fed’s Federal Open Market Committee (FOMC) transcripts from the period concluded that political considerations impacted the Fed’s decision-making and were an important contributor to the rise in US inflation in the 1970s.”
It’s tiresome and counter-productive to say that we have the hottest economy ever, yet we need lower rates.
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