Analyst: Trump's political intervention in the Federal Reserve may become a reality

Odaily Planet Daily News: Market analyst Wilcox said that Trump's intervention in the Federal Reserve may lead to higher inflation. According to a proposal put forward by two senior candidates selected by Trump in his administration, this may become a reality. Trump has selected Stephen Miran as the Chairman of the Council of Economic Advisors and Daniel Katz as the Chief of Staff at the Treasury Department. The two jointly formulated a comprehensive plan to reform the Federal Reserve system, which will give the President and Congress greater political control over the Federal Reserve. A key factor that currently protects the Federal Reserve from political interference is that the President can only dismiss Federal Reserve members for "reasons", but has no authority to dismiss the Chairman. Katz and Miran will give the president the power to dismiss commissioners and chairpersons. Secondly, they will shorten the term of the Federal Reserve Board of Governors from 14 years to 8 years, and make each term start from the date the committee members are confirmed, allowing many or all terms to expire simultaneously. In addition, Congress now authorizes the Federal Reserve to develop its own budget and fund its operations from the proceeds of its securities. Katz and Miran suggest that it be included in the funding process, with Congress approving the Federal Reserve's budget every five years. A large amount of academic literature and American historical experience indicate that strengthening political control often leads to more severe inflation. (Golden Ten)