Donald Trump Owns the Fed, the Dollar & Gold
Donald Trump Owns the Fed, the Dollar & Gold by Jim Rickards
[Ed. Note: Jim Rickards’ latest New York Times bestseller, The Road to Ruin: The Global Elites’ Secret Plan for the Next Financial Crisis, is out now. Learn how to get your free copy – click HERE. This vital book transcends geopolitics and rhetoric from the Fed to prepare you for what you should be watching now.]
Donald Trump has the opportunity to appoint a higher percentage of the Board of Governors of the Federal Reserve system at one time than any President since Woodrow Wilson.
President Wilson signed the Federal Reserve Act during the creation of the Fed in 1913 when they had a vacant board. At that time the law said the Secretary of the Treasury and the Comptroller of the Currency were automatically on the Fed’s board of governors. But besides that, President Wilson selected all five of the other participating members.
Now, Trump has the opportunity to fill more of seats on the Fed’s board of Governors than any president since then.
To review, the Federal Reserve’s Board of Governors is made up of seven appointees. That means that they can make a majority decision with four votes. If you’re reading about the Fed, you might also see reference to “regional reserve bank presidents.” These are roles within the Federal Reserve System, but the real power is found on seven member Board of Governors. (Here’s a little bit more on the Federal Reserve, if you’re interested.)
Right now, there are two vacancies on the board. They’ve been there for a good portion of Obama’s Presidency. Those are two appointments that Donald Trump will get to fill. And roughly a month ago, Federal Reserve Governor Daniel Tarullo announced his intent to resign “on or around” April 5th. That gives us about 30 days away from him leaving the board. His departure would give Donald Trump a third appointment.
There is one Republican that already holds a position on the board. His name is Jay Powell and because the other Fed Governors under Obama were Democrats, he’s been alone in his sandbox at the Fed. That’s about to change.
President Trump will appoint three republicans while already having Jay Powell on the Board, which all together means four republicans at the Fed in the near future.
In other words, Donald Trump will be able to shape the Fed’s majority. His influence goes further than that, however.