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?
Sixth, demanding lower interest rates—he is willing to penalize retirees on a fixed income, needing investment income—to accomplish those five.