In a surprise move from her usual tendency to avoid engaging in a verbal fisticuffs with U.S. President Donald Trump, former Fed Chair Janet Yellen threw her own jab, saying in an interview with Minnesota Public Radio’s “Marketplace” that the president doesn’t have a grasp of economic policy.
“No, I do not,” Yellen tritely responded when asked if Trump “has a grasp of economic policy.”
“Well, I doubt that he would even be able to say that the Fed’s goals are maximum employment and price stability, which is the goals that Congress have assigned to the Fed,” said Yellen.” “He’s made comments about the Fed having an exchange-rate objective in order to support his trade plans, or possibly targeting the U.S. balance of trade. And, you know, I think comments like that shows a lack of understanding of the impact of the Fed on the economy, and appropriate policy goals.”
Yellen’s comments come as President Trump is citing progress in trade deal negotiations with China. Trump said he would delay any additional tariffs on Chinese goods while negotiations are still underway for a permanent trade deal.
Nonetheless, Yellen sees fallacies in the president’s views regarding trade.
“And when I continually hear focus by the president and some of his advisers on remedying bilateral trade deficits with other trade partners, I think almost any economist would tell you that there’s no real meaning to bilateral trade deficits, and it’s not an appropriate objective of policy,” Yellen said.
Click here for the full interview transcript.
There is certainly no love lost between Yellen and Trump who criticized the then-Fed Chair under former president Barack Obama’s administration for keeping rates unusually low. After taking office, Trump made Yellen the first Fed Chair not to receive a second four-year term since the Jimmy Carter administration.
Since then, President Trump has been flicking jabs at Federal Reserve Chairman Jerome Powell for raising interest rates–the same man he nominated for the position. Trump has been leading the chorus on economic growth, taking the opportunity, when presented, to remind everyone that the strong data being extrapolated from the economy is coming under the helm of his presidency.
As far as debates go as to who deserves more credit–the former administration under Barack Obama or the current one under Trump–the president made it clear who deserves the majority, if not all, the credit.
“Barack Obama talked a lot about hope, but Donald Trump delivered the American Dream. All the economic indicators, what’s happening overseas, Donald Trump has proven to be far more successful than Barack Obama. President Trump is delivering the American Dream.” Jason Chaffetz
— Donald J. Trump (@realDonaldTrump) September 9, 2018
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