Larry Kudlow predicts Trump will ‘assume control of the Fed’ on ‘Pod Force One’

Trump’s Tension with Federal Reserve Chair Powell

President Trump’s ongoing conflict with Federal Reserve Chairman Jerome Powell has roots dating back to Trump’s first term and is expected to culminate in Trump attempting to reshape the Fed when Powell exits in May. This observation came from former economic adviser Larry Kudlow during a conversation with Miranda Devine.

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Kudlow shared that Trump was quite frustrated with Powell early in his presidency, especially regarding interest rates, which he felt were raised without significant justification. “It’s somewhat unfortunate. If it weren’t so serious, it might even be a bit funny,” Kudlow remarked. He firmly stated, “But the bottom line is: President Trump will take over the Fed, as he should.”

Powell, who became a board member of the Federal Reserve in 2012 and was promoted to chairman six years later, has faced consistent criticism from Trump. Over the months, the president has called for cuts to interest rates, even hinting at the possibility of firing Powell before his term ends in 2026, although he seemed to backtrack on that threat later.

After a visit to the Fed’s Washington, D.C. headquarters in late July, Trump commented, “It’s a big move, and I don’t think it’s necessary. I believe he’ll do the right thing.” Meanwhile, critics, including those from the White House and Congressional Republicans, have derided the Fed’s costly $2.5 billion renovations, claiming they rival the opulence of the Palace of Versailles.

Kudlow, currently a host on Fox Business Network, supported Trump’s push for changes at the Fed. He mentioned a moderate economist, Mohamed El-Erian, highlighting that even he noted Powell’s inconsistent approach was damaging to the Fed’s credibility.

In a broader perspective, Kudlow emphasized that positions like that of the Federal Reserve Chairman shouldn’t obstruct the president, mentioning that both monetary policy and other operational aspects of the Fed need a comprehensive review. He suggested potential replacements for Powell, naming two friends of his, Kevin Hassett and Kevin Warsh, as ideal candidates for the role.