特朗普打算怎么干美联储? | 一口气了解美联储和白宫的世纪对抗

0:00 Hi~~ Friends, let's talk about the confrontation between the Federal Reserve and the White House. Don't just look at Trump, a good guy, who throws out a blockbuster policy every few days to shock the market. But I feel that the conflict between him and the Federal Reserve is a huge risk that is seriously underestimated by the market. If it is not handled well, it is not a black swan event, but it is very likely to become a financial nuclear bomb. Well, let's relax for a while and take a look at the verbal battle between Trump and Powell. Let's be honest. Trump's ability to speak trash is really beyond doubt. He has been attacking Powell for several months in a row, and he never repeats himself. He bombarded the Federal Reserve from the first day of taking office, saying that he should cut interest rates immediately and repeatedly accused Powell of acting too late and too slowly. Look at Europe, which started to cut interest rates early and has cut interest rates 7 times in a row. Why do you, a "stubborn old man", only cut half of the rate without stopping. Of course, I added the "stubborn old man" for him. As for

0:46 Powell, he always said slowly that we should rely on data, we should be data dependent, and we should maintain the independence of the Federal Reserve and it will not be affected. But in April, Trump seemed to have entered a violent mode. It's not just the tariff policy that is sweeping the world. If the Fed doesn't cut interest rates, the United States will be finished. The sooner Powell leaves, the better. If I want him to leave, he won't be able to stay for long. That means he wants to fire Powell, the chairman of the Federal Reserve. Powell responded that day, saying that the President of the United States has no right to fire you. I thought the war had escalated, but the next day Trump softened again, saying that he had no intention of removing Powell from his position. I just said that. You heard it wrong, right? But he started to give Powell a nickname, calling him "Too Tate Powell" and "Mr. Too Late." Mr. Too Late is a fool who knows nothing, not as well as I do. In fact, the conflict between the two sides, in the final analysis, is that Trump wants Powell to cut interest rates, cut interest rates quickly, and not

1:38 cut them. That's all. The logic behind this is not difficult to understand. As for the US government, we analyzed it in the last video. Although he has so many goals, the most important and core one at the moment is to ease fiscal pressure, and the top priority is to reduce the government's borrowing costs, that is, to reduce interest rates. At the same time, he also has a major goal, which is to hope that the dollar will depreciate. To ease the pressure of manufacturing outflow. You see, these two major goals both require lowering interest rates. This is the main demand of the White House. In order to get Powell to cooperate, Trump plays the bad guy and Treasury Secretary Benson plays the good guy. They have breakfast with Powell every week and try to persuade him. The core goal of the Fed is to control inflation. In the past year, inflation in the United States has actually been controlled below 3%. So you see, the Fed has already cut interest rates by 100 basis points last year. However, this year, because Trump's policy uncertainty is too high, especially tariffs, there is a possibility of resurgence of inflation. So Powell has suspended interest rate cuts this year, saying, "I have to wait and see. I have to see clear data proving that prices have indeed cooled down before I cut interest rates again." It can even be said that the demands of both sides are simple, clear and conflicting, which has

2:23 led to Trump's crazy output against Powell. Well, let's take this opportunity today to talk about the relationship between the Federal Reserve, the US government, the Treasury Department and the White House. Do n't think that Trump is a special case. In fact, the relationship between the Federal Reserve, the most important central bank in the world, and the successive presidents of the United States, who can be said to be one of the most powerful people in the world, has always been very delicate. They are not simply independent of each other, nor are they in collusion or wearing the same pants. Well, in order to deeply understand the love-hate relationship between the Federal Reserve and the White House and understand the logic here, I think the best way is to take everyone to quickly look at the eight major battles that the Federal Reserve has experienced in the past century, its own "War of Independence", and then let's analyze it. Then let's analyze how Trump might deal with Powell now. I tell you, it's very interesting. Let's cut the crap. In 1913, the US Congress passed the Federal Reserve Act, and a central bank composed of 12 reserve banks was

3:09 established. The law stipulates that it is "independent but supervised" and can independently implement monetary policy. But in fact, at this time, its independence was only theoretical. In the early days, monetary policy basically had to cooperate with the needs of the Ministry of Finance. Generally speaking, if the full score for independence is 10, I will give it 5 points. Well, it's not even qualified. Soon, the Federal Reserve ushered in its first battle, which was the gold war in the 1930s. When the Federal Reserve was first established, the United States was still implementing the gold standard. The law requires that for every dollar you issue, there must be 40% gold as backing. So the Federal Reserve is actually a bit like the ultimate gold merchant. The amount of gold it has is equivalent to the amount of money it prints. Although the gold standard sounds very reasonable and strictly limits the amount of money issued, there is actually a very serious problem here. It forces the Federal Reserve to tighten its policy when the economy is in a recession, which

3:54 exacerbates the magnitude of economic shocks. When the Great Depression broke out in 1929, people kept looking for banks to exchange gold. The Federal Reserve's gold reserves dropped sharply from 4.5 billion US dollars to 3.2 billion US dollars, which greatly limited its ability to issue currency. At the height of the crisis when stimulus policies were most needed, the Federal Reserve was restricted and had to tighten its policy. So President Roosevelt took the lead in the White House and promulgated the Gold Reserve Act in 1934, abandoning the gold standard. From then on, the US dollar was no longer backed by gold. At the same time, gold was nationalized, and all citizens had to hand in their gold. The key point is that the object of its handing in was not the Federal Reserve, but the US Treasury. Moreover, he required the Federal Reserve to hand in most of its gold to the Treasury. Once this move was made On the one hand, the Fed's functions in gold were almost completely taken back. On the other hand, in terms of monetary policy, the Fed could control the discount rate, which was basically whatever the Treasury said. The Fed had to give priority to

4:39 meeting the demand for Treasury bond issuance, which basically completely sidelined the Fed. The Fed chairman at that time later recalled and joked that he was nominally the chairman of the central bank, which was so glorious, but in fact, he felt like he was just an assistant to the Treasury and doing some very basic administrative work. After that, World War II came soon. In order to cope with the war, the Fed even lost its superficial independence. The Treasury basically pressed its head and signed an agreement requiring the Fed to purchase Treasury bonds at a very low interest rate of less than 2.5% to help the Treasury raise funds. So you see, during this period, although the Fed was still an independent central bank in name, it was actually a subsidiary of the Treasury. The Fed lost the gold war and its independence score was 2. Originally, after World War II, the Fed should have been more independent and stopped backing up the Treasury. But the US government was about to start the Korean War and the

5:26 government still needed money. President Truman wanted to continue the Fed's model of printing money to buy Treasury bonds. Well, this time the Fed was tough. After all, because too much money was printed before, the inflation in the United States had exceeded 9% at that time. If it continued like this, the economy would really be in trouble. So the Federal Reserve said no, no, it did not agree to Truman's request. After several very difficult negotiations, the then Secretary of the Treasury, who was also a good friend of Truman, used a shady trick. He did not communicate with the Federal Reserve, but directly gave a public speech in January 1951, saying that the Federal Reserve had agreed to the Treasury's Treasury bond purchase plan. The Federal Reserve Chairman was anxious when he heard it. When did I agree? The conflict between the two sides intensified. After all, the Federal Reserve is still independent in law, and he still has some capital to be tough. He said, if your Treasury still has such a tough attitude, then our policies will be completely independent from now on, and there will be no room for negotiation. After a month of fierce public conflict between the two sides, the Treasury finally gave in. The Federal Reserve

6:12 and the Treasury signed the famous 1951 Monetary Agreement. The Treasury agreed that the Federal Reserve would no longer purchase Treasury bonds at a fixed interest rate. The market generally believes that the real independence of the modern Federal Reserve started from this 1951 agreement. The Federal Reserve won the battle of independence, and its independence score is 6 points As the price of negotiation, the then chairman of the Federal Reserve resigned. He was replaced by the then assistant secretary of the Treasury Department who was in charge of negotiations. His name was William Martin. This name is very important. Remember, the Treasury Department had a good idea. I would place one of their own in the Federal Reserve so that even if I signed an agreement later, they could cooperate on policy. But they didn't expect that this so-called "own man" they placed in the Federal Reserve would become the founder of the Federal Reserve's independence. He served for nearly 20 years and was the longest-serving chairman in history. A Federal Reserve building

6:57 was named after him. Let me talk about Martin for a moment. Just by looking at his resume, you can tell that this person must be very smart. He graduated from Yale University. After graduation, his first job was at a brokerage firm. After two years, he became a partner of the firm. At the age of 29, he became a member of the board of directors of the New York Stock Exchange. At the age of 31, he became the president of the New York Stock Exchange. He was called the "Wall Street prodigy." He joined the army during World War II and became a colonel. After World War II, he joined the Treasury Department and became an assistant secretary of the Treasury. Then he became the chairman of the Federal Reserve, and he served for 19 years. It was quite impressive. I felt that his 19 years in office were very profound. This affected the policy logic of the Federal Reserve and the game relationship between the Federal Reserve and the Treasury Department. With the legal protection of the previously signed agreement, Martin's attitude was obviously much tougher than that of the previous Federal Reserve Chairman. In most cases, price control was still the most important consideration. From 1952 to 1965, the

7:44 average inflation rate in the United States was only 1.3% in the 13 years. It was called the "Martin Miracle" in history. In 1965, the United States was deeply mired in the Vietnam War and its finances were tight again. At that time, President Johnson began to put pressure on Martin to ease monetary policy. Martin said, " I just won't cut interest rates. Not only will I not cut interest rates, I will also raise interest rates by 0.5%. Do n't you think it's infuriating?" President Johnson was really angry at the time. He said that our children were dying in Vietnam, but you refused to print money. In fact, if Martin were put today, he would definitely be a hawk among hawks. At that time, the inflation rate in the United States was actually less than 2%, but Martin felt that the unemployment rate was too low and he had the risk of overheating of the economy. So he still raised the interest rate to 4.5%. However, this does not mean that Martin was a hard-nosed person who did not care about the needs of the government. What is his style? My summary is that he is tough in principle but he is sometimes timid. For example, when Eisenhower put pressure on him in 1953 and

8:30 Kennedy put pressure on him in the 1960s, he actually gave in and cooperated with the monetary policy of the Treasury. In general, Martin did establish a very good independent Federal Reserve. But in fact, his independence does not come entirely from power or legal protection, but a lot of it comes from his balancing act. He created a "four-person meeting" that includes the chairman of the Federal Reserve, the secretary of the Treasury, the White House budget director, and the chairman of the Council of Economic Advisers. These four people would sit together for dinner and communicate fully, which also helped the Federal Reserve to maintain its relationship with the White House. So you see, the tradition of Powell having dinner with Bessant all day long was a continuation of that era. This Martin era, hey, I also count it as a battle, it can be regarded as a victory for the Federal Reserve, and the independence score has risen to 7 points. Hey, are you curious about when it will go up again? By the way, this score is my personal subjective ranking, and it has no authority. If you think it is wrong, then you are right. At

9:16 this point, have you discovered that the Federal Reserve and the US government are ultimately independent? Most of the time, their disagreement is that when the Fed feels the need to raise interest rates and tighten monetary policy, the US government won't allow it. Economist Hertzl once commented that the Fed chairman often has to deal with a president and Congress that are hostile to rate hikes. Why is he hostile? In fact, as a government, he doesn't like rate hikes for two main reasons. One is that rate hikes will suppress the economy. And a key indicator for measuring a president's performance is the economic performance during his administration. So the period when every US president has put the most intense pressure on the Fed is usually the year before an election year, especially the year before a re-election year. Another reason is that the higher the interest rate on government debt, the higher the government's borrowing cost. So every time money is needed for a war, the pressure on the Fed from the Treasury is particularly great. You see, these two points, economic development and debt costs, are the

10:01 most core underlying interests of the US government. So the president and the government are sometimes helpless. If you meet a very hawkish Fed chairman, prices are tightly controlled, but the economy may be very bad during the years when you are in office. The Fed chairman can still be re-elected and can outlast you. In the end, everyone still blames you for being the president. So can you understand why whenever the Fed raises interest rates, the president almost has to jump up and grumble as a reflex, but on the contrary, when the Fed cuts interest rates, the president is very happy. During Trump’s first term, Powell raised interest rates four times in a row in 2018. Trump was outspoken in his criticism of Powell and the Federal Reserve. But when the epidemic came, Powell quickly and urgently cut interest rates to 0% and also launched quantitative easing. Trump then praised him very rarely, saying, "Old Powell, you did a great job!" Okay, let’s go back to the Martin era. Why is it still Martin? Don’t worry, he’s about to be removed. In 1969, inflation in the United States began to rise rapidly. Martin raised interest rates by 1%. The

10:47 newly elected President Nixon was furious. He had just promised American voters in the election the year before that he would revive the U.S. economy. As soon as he came to power, he met such a stubborn old man like Martin, so he publicly criticized Martin, saying that you were pushing the U.S. economy into recession. And Martin, he has been the chairman of the Federal Reserve for nearly 20 years, and his back is very straight. Completely ignoring the pressure from Nixon, Nixon wanted to replace Martin as soon as possible. But what was the problem? Legally, the US President could not dismiss the Chairman of the Federal Reserve at will. Well, Nixon used a shady trick at the time because Martin's term was to expire in 1970, which was the next year. Although Nixon could not directly force him to step down, he announced in advance that the new Chairman of the Federal Reserve would be named Burns, who was also his own man. In this way, all the attention and focus of the market turned to the successor Burns. In fact, it was equivalent to sidelining Martin, which was equivalent to letting Martin step down in advance. You see,

11:32 this is quite similar to Powell now. Powell's term of office will also expire next year. Trump has also been bombarding him crazily. This is why many people speculate that Trump will use Nixon's trick to announce Powell's successor in advance to sideline him. And the policy style of the newly appointed Burns, after being recommended by Nixon to take office, can be summarized in four words: obedient and obedient, and he cut interest rates right from the start. In 1972, in order to help Nixon win re-election, he lowered interest rates again. And most of the time, it was not Nixon who pressured him. Burns lowered interest rates. It was Burns who took the initiative to lower interest rates. Oh, how do I know this? Because later the famous Watergate scandal happened. The White House recordings happened to expose some of the conversations between Nixon and Burns. For example, on December 10, 1971, Burns called Nixon and said, " Mr. President, I want to let you know that I have lowered the discount rate to 4.5%. Nixon was very satisfied and said "Good, Good, Good" three times.

12:19 Another time, Burns said, "In my opinion, I have done my best to help you become president and establish your reputation and status in American history. Look at this cooperative attitude. How hard you work. You do n't even need to open your mouth. I will satisfy you in advance." Of course, what I said was a little joking. It felt like Burns was a dog licker. In fact, he was also an economist with very high academic achievements. He also negotiated with Nixon, but the intensity was not enough. Judging from the results, during the Burns period, the Federal Reserve It can be said that the independence of the Federal Reserve was surrendered. The independence score is 3 points. However, as the saying goes, "Everything will turn around when it reaches its extreme; there is no creation without destruction." The Burns period also brought some benefits. It was because he was such a bad chairman that Congress began to strictly review the policies of the Federal Reserve and could not let it mess around, especially not mess around under the instruction of the president. It clearly stipulated the dual goals of the Federal Reserve, namely, price and employment. It required the Federal Reserve chairman to

13:05 submit a "Monetary Policy Report" to Congress every six months, and also to attend a hearing of both houses. I tell you, it was at that hearing that I felt sorry for the Federal Reserve chairman. Although he was the chairman, he felt like a prisoner sitting in the middle of Congress for two hours. He had to be interrogated repeatedly, " Why did you raise interest rates? Why is inflation so high? Why did you print money? Why this, why that, and a hundred thousand whys?" And it was like this twice a year. When I first watched it, I was really scared by it. I felt that if I sat there, I would cry. Oh, I'm off topic. Let's get back to the topic. Anyway, after the Burns period, Congress greatly strengthened its review of the Federal Reserve at the institutional level. And then came the highlight moment of the Federal Reserve, which was its next chairman, Paul Walker. Look at this highlight moment, first of all, he is very tall, more than two meters tall, and even he had to bow his head when he saw inflation. When Paul Walker came to power in 1979, he was facing what could be said to be the worst period of the

13:50 US economy in nearly 100 years, with an inflation rate of 14%, an unemployment rate of 7.5%, and out-of-control gold prices. The US economy fell into stagflation, and Walker was extremely tough after he came to power. His goal was to protect prices and to bring inflation down. The federal funds rate rose from 11% to more than 20%, and then inflation was suppressed instantly, from 13.5% in 1980 to 3.2% in 1983, known as the "Walker miracle". I raised it myself. I tell you, do n't think that his interest rate hike at that time was as simple as we said in a few words. He was under tremendous pressure at the time. Raising the interest rate to 20% directly led to the most serious economic recession in the United States since World War II. The unemployment rate soared to 10.8% in 1982 Some small and medium-sized enterprises and farmers went bankrupt on a large scale. He often received death threats. President Carter complained privately and

14:35 President Reagan tried to intervene, but it was useless. Walker said that he had to do what he said. He even directly rejected the invitation from the White House, saying that the Federal Reserve does not serve any political party. This period can be said to be the period of the most intense conflict between the Federal Reserve and the US government. But time has proved that Walker's choice was right, and not just right, but very right. After experiencing a brief period of pain, the US economy has regained vitality for at least 20 years. At that time, the United States had just left the Bretton Woods system. Walker's strong approach to maintaining the inflation of the US dollar greatly enhanced the market's confidence in the US dollar. It can be said that it laid the foundation for the US dollar's status as the global reserve currency in the next half century. It was also from Walker that although the Federal Reserve had a dual mission, when the two of them conflicted, inflation usually took the lead. I gave Walker's Federal Reserve independence score of 9 points. Walker's successor Greenspan served as the chairman of the Federal Reserve for 18 and a half years, which is

15:21 also the second longest (term). If I use one word to summarize his term, it is muddying the waters. I tell you, Greenspan is simply a master of language. He has brought the art of language to its extreme. It is very ambiguous. You can understand it in any way. For example, he often says, " If you think you understand what I say, then you must have misunderstood what I mean." What exactly do you mean? He also likes to use metaphors. For example, he says that the market is irrationally prosperous. So is it prosperous or overheated? He also doesn't comment when answering questions at congressional hearings. He insists that whatever he says is reasonable. I feel that he has mastered some oriental language arts. But Greenspan is actually very good at balancing the needs of the market and the Treasury. It was also from him that the Federal Reserve emphasized full communication and synchronization of market expectations. As a veteran who served four presidents, his prestige during his tenure

16:07 can be said to have reached the peak of all Federal Reserve chairmen. In the end, the US president didn't even dare to complain. His independence score is 8. Of course, Greenspan has prestige. He maintained the independence of the Federal Reserve. It doesn't mean that he didn't make mistakes. His excessive relaxation of supervision on financial derivatives can be said to have led to the 2008 subprime mortgage crisis, which is one of the most important reasons at the bottom. Hey, have you found a pattern? The work of the Federal Reserve chairman In fact, it is not enough for him to just control inflation. In essence, he is a middleman between the market and the US government. He can influence the market, and the government can influence the Federal Reserve. The Federal Reserve is in the middle. It is not that I stand firmly on the side of the market. In this case, the White House will definitely find a way to deal with you. If it leans to the government, it will be even more serious. The market may in turn impact the dollar and deal with the Federal Reserve and the US government together. So the Federal Reserve actually has to seek a very delicate balance in the middle. While maintaining independence and

16:52 winning the trust of the market, you can't make the government or the president too unhappy. Look at Martin and Greenspan. Why can they do it for so long? In fact, it is not because they are simply tough, but they pay great attention to this balance and are very good at maneuvering in the middle. They have a very good sense of balance. Look at Martin, as we said just now, his style is tough in principle and intermittently giving in. Greenspan is a smooth talker. Well, they are both very flexible, stick to their independence, and know how to be smooth. So every time there is a change of term, although the president can appoint a new one, it always feels that the chairman is a little stubborn and can cooperate when it is necessary. The market still trusts him so much, why not just not change him? And then in the era of the financial crisis, we had two chairmen, Ben Bernanke and Yellen. How about their independence? I can only say that on the surface, the government did not interfere too much in their decision-making, but in fact, their independence is hard to see. Because during this period, the Fed's policies were completely matched with the government's needs.

17:39 In order to cope with the financial crisis, the Fed has been implementing low interest rates, massive money printing, quantitative easing, and printing money to buy government bonds for more than ten years. These policies are not only what the market needs, but also what the government wants to see. The needs of both sides are synchronized, and the Fed, as a middleman, is in the middle, so it is very easy to do. So during this period, you rarely hear the president raise any objections to the Fed. The only thing left is that there is a little bit of gunpowder in every congressional hearing. So in this post-financial crisis era, I give the Fed's independence a 7. You see, as we just said, the Fed and the Treasury have been arguing for so many years, mainly around whether to cut interest rates, such as monetary policy. But after the financial crisis, the Fed has greatly strengthened a right, that is, supervision, supervision of banks and financial institutions. In fact, the Fed has always had this right, but I didn't mention it just now because this role was not very prominent before. But after 2008, The United States passed the important Dodd-Frank Act, which greatly strengthened the regulatory requirements for large financial institutions.

18:24 One of the main executors is the Federal Reserve. So now when people in Wall Street investment banks hear about this bill, they feel overwhelmed. Various risk indicators, capital adequacy ratios, etc. are very strict. Do you want to say whether it is a bit of an overreaction? I think it is more or less a bit, but if you don't go too far, it is actually very difficult to correct the overreaction. After such strictness, some small banks such as Silicon Valley Bank went bankrupt. The struggle over the independence of regulatory power. In fact, before 2020, there was not much resistance. After all, the Federal Reserve printed money on a large scale and carried out unprecedented quantitative easing at that time. Everyone made money, so no one said anything. But now, interest rates have been raised, and while tightening, the supervision is still so strict, and resistance has risen. Don't look at the current situation. Trump is clamoring for the Federal Reserve to cut interest rates every day. In fact, you can see from Bessant's interview that from an institutional perspective, what they want to cut is not the Federal Reserve's monetary policy, but their regulatory power. Well, finally, we have come to this post-epidemic era, the trade war era,

19:09 or the Trump era. It seems that Powell will implement monetary policy more independently and can be tough when he needs to. But when faced with pressure, it will compromise a little, that is, cooperate with the Treasury Department and the President. For example, it began to comply with the demands of the Republican Party and gradually relaxed the supervision of financial institutions. During the epidemic, it also worked with the Treasury Department to provide loans to local governments and small and medium-sized enterprises, etc. You can't say that the Fed has given in, because it is indeed necessary, but the overall feeling is still relatively loose, that is, while maintaining independence, it will also take into account the White House and the Treasury Department. So now the independence score is 8 points. After more than 100 years, do you have a feeling? At the bottom, the Federal Reserve Act protects the independence of the Federal Reserve, but in fact, it still requires specific people to play games. Well, let's see how Trump plans to play the White House and the Treasury Department. What methods does he have to control the Federal Reserve and put

19:54 pressure on the Federal Reserve? The first move is personnel. Can Trump fire Powell? The simple answer is no, unless Trump can cite enough legitimate reasons, such as proving that Powell has violated the law, seriously neglected his duties, is morally corrupt, mentally ill, etc. It seems that if Trump wants to fire Powell, he has to go through labor arbitration. At present, this possibility is very low. The appointment mechanism of the Federal Reserve Chairman is as follows: the President of the United States nominates, and then the Senate approves The term is four years and can be re-elected. The incumbent chairman cannot be fired by the president simply because he is not satisfied with the Fed's policies. So even if Trump wants to replace him, he has to wait until the end of his four-year term to appoint a new chairman. Powell was nominated and took office in 2018, when Trump served his first term, and was later re-elected during Biden's term, so his term expires in 2026. Trump can announce the next chairman in advance as Nixon did to Martin, and use this "shadow chairman" to sideline Powell,

20:41 but he has not done so so far. But let me tell you, if Trump wants to influence the Fed, he doesn't necessarily have to target Powell alone, because the Fed has a very important feature, which is that it is not just one person. In fact, all major decisions of the Fed are jointly decided by the Federal Open Committee (FOMC), which is composed of 12 people. The weight of each vote here is the same, so in theory, the chairman does not have a greater voting power, nor does it mean that he listens to the chairman. So for Trump, assuming he can control the majority of these 12 people, he can control and influence the decisions of the Fed. In terms of mechanism, these 12 people There are 7 people appointed by the government, and 5 of them are from the presidents of local reserve banks. For those who are interested, you can watch the video we talked about the Federal Reserve. In short, they get so many people to make decisions together in order to balance the relationship between the government, banks and the market.

21:27 But even the 7 people selected by the government are not replaced at will. Each of them has an ultra-long term of 14 years, and one of them expires every two years. For example, although Powell's term as chairman expires in 2026, his term as a director will not end until 2028. So even if he retires next year, he will most likely still be a director in this team of 12 people, and he will still have voting rights. In fact, the way the government has been trying to influence the Federal Reserve, in addition to appointing the chairman, is to put more doves in the FOMC. Doves are those who advocate monetary easing. Generally, when people analyze the monetary policy of the Federal Reserve, they will analyze who is a hawk and who is a dove among the 12 people, and what each person's inclination is. It is obvious that most of the 7 people selected by the government tend to be dovish, and the hawks basically come from the reserve banks. The White House is continuously influencing the decisions of the Federal Reserve indirectly through personnel appointments. But at this point in time, he can't replace all seven people at once,

22:13 so it's still difficult to get an immediate effect. Another possible way for Trump to intervene in the Fed is through executive orders. Although it's difficult to change legislation, the president can use executive orders to temporarily restrict the Fed. For example, in February of this year, Trump issued Executive Order No. 14215, requiring all independent agencies to submit major regulations to the White House for review before issuing them, and you have to communicate with the White House regularly. You see, this is actually what we mentioned before. Trump and Bessant want to limit the Fed's regulatory power and want it to relax regulation. In fact, in addition to these two tricks, Trump's most common way to influence the Fed is through public opinion. He says that Europe has cut interest rates, why haven't you cut them? If the U.S. economy continues like this, it will be over. Powell, you are always too late, always wrong, and always too late. In short, you want to use these to influence public opinion and put pressure on the Fed. But at present, it seems that the effect of this trick is not very obvious, and it is even a little counterproductive. In fact,

23:01 although Trump is the president of the United States, it can be said that there are few people on the earth who have more power than him, but one of the institutions that makes him most helpless and helpless is the Federal Reserve. You see, he can directly throw out all kinds of heavy-weight policies to other departments, organizations and even countries. He only scolds the Federal Reserve more harshly than anyone else. But when it comes to the actual physical attack, he doesn't make a single move. He just couldn't help but threaten to fire Powell, but he backed down in less than a week. For example, the executive order states that everything must be reported to the White House. Although it weakens the power of the Federal Reserve, it only dares to focus on supervision because the executive order specifically adds a clause that does not include the monetary policy of the Federal Reserve. That is, the monetary policy of the Federal Reserve does not need to be reviewed by the White House. Why? There is no need for him to add this clause. This actually indirectly confirms a logic, that is, the White House dare not. Although it wants to, it dare not interfere too much with the policy of the Federal Reserve. Even if it wants to try, it is

23:46 extremely cautious. This is because the Federal Reserve is not just an independent institution. There are people backing it up. What has a deterrent effect on the US government is the trust of the market. From 1951 to the present, Martin Walker, Greenspan, Bernanke, Yellen, and Powell have built up this sustainable market trust bit by bit. It is because of this trust. It supports the US dollar to become the international reserve currency, allowing global capital and central banks to invest in the US dollar without too many concerns. I dare say that this trust is far greater than the market's trust in the US government. Tariffs sound very important and connect so many countries. We also analyzed it in the last issue. Its actual GDP is only 3 trillion US dollars. The scope is wide, but the degree of connection is not that close. The financial market is different. You can say that it is deeply connected to the bones of the United States. Whether it is government bonds, bonds of all large companies, or stocks of all large companies, they are all based on the

24:32 global market's trust in the US financial market and the US dollar. The main pillar behind this is the Federal Reserve. Therefore, it is one thing for Trump to force him to cut interest rates, but it would be bad if the foundation of the US dollar is shaken by accident. Bessant has also repeatedly warned the White House that firing Powell may cause market turmoil. However, Trump's recent series of actions have indeed shaken the trust of many markets in the US dollar. Other countries are more or less de-dollarizing to a certain extent. Although the market generally believes that Trump dare not touch the Federal Reserve and dare not weaken the independence of the Federal Reserve, they are still worried that if he is in a bad mood one day, he will come up with a policy. If this really happens, it will be a real black swan event for the market. Mr. President, I want you to know that I have lowered the discount rate and helped you become president. How can you be so cheap? It

25:17 ushered in the highlight moment of the Federal Reserve. Paul Walker even added rhyme. It is called the Walker miracle. I added it myself.