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President Biden announced the reappointment of Jay Powell as Federal Reserve Chair and the new appointment of Lyle Brainard as Vice Chair. Ms. Brainard is currently the governor of the Federal Reserve Board.

Here’s my takeaway:


The president basically said, ‘Jai, you’re my man because in our conversation you promised to maximize employment, make climate change a top priority,’ and to your speech a month ago where you said how much the Fed Will work hard to resolve the prevailing inequalities.’ Biden also mentioned standing with Donald Trump. And I’ll tell more about that in a moment.

Here’s what Mr Biden didn’t say, ‘Inflation is the number one economic problem in the country today; rising inflation can only be stopped by the Fed pressing the monetary brake. And the sooner you take steps to check inflation, the better for us. The President did not say so. He mentioned inflation. More in terms of how his $5 trillion big government socialist plan will curb inflation. It’s a view that basically no one outside the White House agrees with.

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Biden Taps Jerome Powell as Fed Chair for Second Term as Inflation

What the Fed should do now is end quantitative easing. No more buying property. Stop filling the economy with extra money it doesn’t need or need. And then, get ready to raise your short-term target rate in January. That’s what they should do. Not that Mr Biden suggested they do. He says keep an eye on jobs, climate change and inequality. guess what? Very easy money coming in.

Mixed Stocks as Biden Taps Fed’s Powell for Second Term

The appointment of Ms. Brainard is certainly a relief to the ‘awake’ progressive Left. Ms. Brainard will fight hard for climate change policies, heavy regulations on financial companies, various inequalities in the labor force and perhaps elsewhere, and new diversity at the Fed. Not what you would call a hard money gal. By the way, in Congressional testimony, Ms. Brainard has declined to directly answer the question of whether she believes in capitalism or socialism. How hard it can be for a former Treasury official and long-fed official to fall in favor of American capitalism. Well, I guess in his case, it’s a lot harder.

Texas Congressman Roger Williams, who asked him on several occasions, would be with us later on the show.

Now, with Powell and Brainard clearing the dust, and I think both of them will be confirmed by the Senate. There will still be four vacant seats on the Federal Reserve Board. One of them is the vice president for regulation and then there will be three others.

You can bet that White House figures leave Republican Powell in there, but besides Ms. Brainard we can load the truck up with a group of people dedicated to waking up to climate change, diversity, inequality, on employment. Can focus and not inflationary rush.

Steve Moore on Fed announcement: Brainard ‘would have been a disaster’

By the way, the stock market, who loves easy money, who loves easy free Money, and lots of it, rallied today with a new S&P record. And I’m afraid, easy money, they’re going to get it. We will all pay the piper for the rising inflation. but not now.

Final point: This business of Jay Powell stood out to former President Trump. Now as I said, I know Jay. i like her Had many, many lunches and meetings with her in the office and with a choice between myself and Ms. Brainard, I have publicly stated that I took her side. But in terms of policies, Jay Powell raised the Fed target interest rate four times in 2018. This despite the fact that there was no apparent inflation. The average inflation rate in 2018 and 2019 was around 1.5% after the 2017 Trump tax cut. And Mr. Powell raised rates 4 times. Today, with inflation in excess of 6%, he would not raise rates at all. There is a discrepancy here. Isn’t there?

And the economy was booming after the Trump tax cut! With a four-quarter change of 4% without inflation. and record low unemployment. In fact, for a fella who has said he’s concerned about maximizing employment and ending inequality, it’s odd that minority unemployment hit a 50-year low during President Trump’s tenure. Blacks, Hispanics, Women, Asians. The poverty rate fell. Average blue-collar household income increased. Inequality decreased. Without inflation!

And President Trump, a seasoned investor and businessman who carefully followed the markets, was furious. And he had a right to be furious over this unfair and unfairly fed policy.

Finally, after inducing a major recession in the economy, along with raising their rates, the Fed took a 180-degree turn and began cutting rates three times in July, September and October of 2019. And less and behold the tax cut-free economy began to roar back.

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Until the pandemic came crashing down. In early March, worried about COVID, the Fed cut its rates slightly. Then a week later, the Fed unexpectedly moved its target rate to near zero. The news was passed on to President Trump while he was speaking in the White House press room. I was sitting there by the wall in the room. I don’t remember who whispered it to him, but it happened while he was talking. And when he got the news, he looked up with a smile and said with some effect, ‘Wow, the Fed just went to zero. I now nominate Jay Powell for the Best Player of the Year award.

So, Mr. Trump was odd-even. He criticized the Fed and then praised the Fed. That’s what the president does. Because he is the President. So I end my talk, Save America. Hit the bill And conquer inflation, Mr. Powell.

This article is adapted from Larry Kudlow’s opening remarks on the November 22, 2021 edition of “Kudlow.”