That old Trump, while he’s publicly shouting about firing Federal Reserve Chairman Powell, whether he succeeds or not is another story. But look at the little maneuvers he’s making behind the scenes? Tsk tsk, the Federal Reserve building is almost fully 'renovated' by his people inside and out! Even the Treasury Secretary, Basant, has declared: we must carefully 'examine' the Federal Reserve, just like tidying up other departments, it needs a thorough cleanup!
The key point is coming, let's discuss it in sections:
Banking rules? Dismantle! Dismantle! Dismantle!
What does Trump hate the most? Strict regulations! He feels there are too many rules, and banks cannot freely make money. So, he quickly placed his own person—Aunt Bowman—in a key position to oversee banking regulations. This aunt has been in the Federal Reserve since 2018, and now she’s finally in control.
Once Aunt Bowman took office, she was swift and decisive! She quickly loosened the 'thick coat' (the rules added after the financial crisis, known as capital buffers) on the banks. The banks were ecstatic: 'Oh my God, now we can lend more money and make a fortune!' But the keen-eyed people were anxious! The former head of bank supervision, Barr, scolded: 'Isn't this ridiculous? You're emptying the banks' life-saving assets; if something happens, the entire banking system is done for! Isn't this self-destructive?'
What’s even scarier is that Aunt Bowman recently held closed-door meetings with the banking moguls, with just one theme: how can we make the rules governing banks more 'simple'? The representatives from the banks argued quite 'reasonably': 'Previously, the rules were loose but simple and easy to understand; now, the rules are strict but seem like hieroglyphics. Can't we have rules that are both strict and simple?' Bah! Sounds nice, but in practice, 'simple' often becomes an excuse for 'loosening'! When the rules are relaxed, who suffers? Isn’t it us common folks who deposit money?
Layoffs! Save money! The Federal Reserve must also 'slim down'!
The Trump administration looked at the tens of thousands of employees at the Federal Reserve, their eyes nearly popping out: 'What, are we just feeding so many people? Layoffs! Must lay off!' Chairman Powell was actually quite savvy and had already stated that in the coming years, 10% of the staff (about over two thousand) would be cut, under the guise of 'increasing efficiency'.
But the guys in the White House are not satisfied! Secretary Basant is shouting for it to be 'more ruthless'! The next chairman candidate that Trump has in mind, Waller, is directly bashing on TV: 'The Federal Reserve has too many idle people! There’s a bunch of useless old men!' It sounds like all the hardworking ones are just air.
Why the rush to lay off and save money? Hey, even the Federal Reserve can't make ends meet! To keep rising prices (inflation) in check, they are raising interest rates like crazy and ended up sinking themselves—reportedly losing over 22 billion dollars! Basant has caught hold of this and keeps bringing it up: 'Look! Look at the good things you guys have done!' What’s even funnier is that when the Federal Reserve wanted to spend 2.5 billion to renovate their old place, Trump took a tour and didn’t even scold them? His attitude changed faster than flipping a book! Principles? Those depend on mood!
Power games: Can this 'renovation' actually happen?
The old hand from the Federal Reserve, English, came out and said a big truth: it's easy for the Federal Reserve chairman to fire a few executives, but to completely overhaul the entire institution and lay off a large number of employees? That’s difficult! It requires a vote of approval from the whole committee! The new chairman (like the one Trump wants to appoint) may be ambitious to make big changes, but will the other committee members agree? That's debatable! These people are not to be underestimated.
In the end, we have to ponder:
Trump is playing a deep game here! While Powell is still in office, he is quietly placing his own people (Bowman) in key positions, hastily dismantling the banks' 'bumpers' (relaxing regulations), while also shouting about major layoffs (saving money + blood change). All of this is aimed at the moment in 2026 when Powell is out (or is forced out)! At that time, he will replace him with someone he absolutely trusts (like that Waller), then the Federal Reserve will truly become his 'private territory'!
Just thinking about it makes one break out in a cold sweat:
With the banks' 'bumpers' dismantled, if one day there’s a major tumble, who will back it up? Isn’t it still our taxpayers' money?
How can those who supervise banks be buddy-buddy with the banking moguls and still enforce the law fairly? Doesn’t that become 'guarding one's own theft'?
The Federal Reserve was originally supposed to be an independent 'technical agency' for managing money, but now it looks like it’s about to become a 'political tool' in Trump's hands! Is that acceptable?
What’s the most frustrating part?
The Trump administration has disparaged the PhD economists working at the Federal Reserve as 'drawing pay for nothing', 'not understanding what they are doing', and 'academic slackers on basic salaries'! They have rendered a professional institution responsible for financial regulation and economic stability worthless! Just to push their 'burden reduction' (reducing burdens on banks) and 'efficiency' (layoffs to save money) nonsense!
So, we have to ask one final question:
Waiting for the day when the banking moguls mess up and collapse the economy, who will they blame? Will it be the economists who are being criticized today as 'useless', or will it be the banks themselves who are shouting 'long live deregulation'? At that time, will those who are clamoring today to dismantle the 'guardrails' stand up to admit their mistakes and compensate? Think about it carefully!