Donald Trump is not backing off his criticism of the Federal Reserve’s interest rate hike.
Wall Street and the financial media got a case of the vapors Thursday after President Trump noted that he wasn’t happy with the Fed’s monetary policy in a CNBC interview. The White House had to issue a statement clarifying that the president still believes in the independence of the Fed.
But the president himself was not cowed. On Friday morning he tweeted:
….The United States should not be penalized because we are doing so well. Tightening now hurts all that we have done. The U.S. should be allowed to recapture what was lost due to illegal currency manipulation and BAD Trade Deals. Debt coming due & we are raising rates – Really?
— Donald J. Trump (@realDonaldTrump) July 20, 2018
The notion that the President of the United States should not publicly criticize our central bank was invented by Robert Rubin, the former Goldman Sachs leader who served as Bill Clinton’s Treasury Secretary before taking a seat on the board of Citigroup. Prior to the Rubin Rule, presidents routinely criticized the Fed. Ronald Reagan made direct attacks on Fed policy a regular feature of his annual economic reports to Congress.