Treasury Secretary Steven Mnuchin contacted the heads of the six major banks — Citi, Bank of America, Goldman Sachs, JP Morgan Chase, Morgan Stanley, and Wells Fargo — to explain that there was “ample liquidity for investing” despite the government shutdown.
The banks reassured him that they haven’t seen “any clearance or margin issues and that the markets continue to function properly.”
Today I convened individual calls with the CEOs of the nation’s six largest banks. See attached statement. pic.twitter.com/YzuSamMyeT
— Steven Mnuchin (@stevenmnuchin1) December 23, 2018
He also activated the “plunge protection team” as we saw in 2009. Despite the situation over tariffs and the shutdown, the Federal Reserve increased interest rates, which will possibly slow down the economy.
The officials in the group come from the Federal Reserve and the Securities and Exchange Commission. The group is part of the President’s Working Group on Financial Markets, which will come together Monday on a call with Mnuchin.
That has alarmed most, but some say it’s the right call.
WHAT IS THE FEDERAL RESERVE UP TO?
During Obama’s time in office, the Federal Reserve did not increase interest rates for the first seven years over which he ruled. The Feds didn’t raise the interest rates when the economy was okay from 2012 to 2014.
There is no evidence of inflation concerns, and inflation was higher during Obama’s reign, 2.2% under Trump as compared with Obama’s 2.6%. Prices rose 14.6% during Obama’s regime and are only marginally rising now.
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The Feds have been very aggressive during the Trump presidency. Why? It appears political. If they slow the economy, Trump will be defeated. Don’t underestimate the ruling class’s ability to RESIST and the hate towards the President. If you go through any of the threads of the people listed here, you will find the anger towards the President is intense.
The ruling class wants people to believe Trump’s a sham, a fraud, a buffoon, but he made billions. And he has more common sense than many of those living in the little kingdom in D.C.
There are rumors that the President will replace Jerome Powell at the Reserve after this last rate increase and that has the markets worried.
The markets freak out over everything.
Mnuchin went online to state his objections to the rate increase
(1/2) I have spoken with the President @realDonaldTrump and he said “I totally disagree with Fed policy. I think the increasing of interest rates and the shrinking of the Fed portfolio is an absolute terrible thing to do at this time,…
— Steven Mnuchin (@stevenmnuchin1) December 22, 2018
(2/2) especially in light of my major trade negotiations which are ongoing, but I never suggested firing Chairman Jay Powell, nor do I believe I have the right to do so.”
— Steven Mnuchin (@stevenmnuchin1) December 22, 2018
REACTIONS ONLINE
The haters in the financial community will never see the benefits of the Trump economy, and while they may not want it to fail, they too strongly believe Trump has to fail. It’s not everyone, but it’s many of the powerful. Their politics clouds their feelings and actions.
I’m confused. In mid-Oct. Mnuchin said the drop in stocks was a “natural correction.” Today, on a Sunday, he held calls with the CEO’s of the six biggest banks to ask about their businesses. Does Mr. Mnuchin still think this is simple correction or is he worried about more?
— Scott Wapner (@ScottWapnerCNBC) December 23, 2018
Well when you put it that way https://t.co/nl1eWPD7hw
— Binyamin Appelbaum (@BCAppelbaum) December 24, 2018
“It’s being pre-emptive,” a person familiar with the matter told CNN. “It’s sending the proper message to the market so they can calculate the real picture into their Monday opening.”
via @donnaborak https://t.co/ZV9UP0aWIM— Phil Mattingly (@Phil_Mattingly) December 23, 2018
You might want to read this classic article before you issue any more press releases of this type.https://t.co/pIKzZwaNps
— Jason Zweig (@jasonzweigwsj) December 24, 2018
wpDiscuz
