‘What did you earn at your last company?’ is becoming an increasingly contentious question.
By Heather Long
In 2011, when Republicans were threatening to force the government to default on its debt if the party’s policies were not adopted, they found support in a flashy, wealthy businessman: Donald Trump. “The Debt Limit cannot be raised until Obama spending is contained,” he tweeted.
A countervailing voice came from a wealthy, mild-mannered businessman who had left the world of high-finance to work for a $1 a year for one of Washington’s quiet think tanks. Jerome Powell, a former Carlyle Group executive and investment banker who had served a stint in the George H.W. Bush administration, traveled around Capitol Hill with a large binder from the Bipartisan Policy Center, urging Republicans to understand the risks of a default on the economy.
“He was the right person at the right time,” says Jason Grumet, president of the Bipartisan Policy Center. “Powell brought a credible, factual presentation to Capitol Hill that allowed him to be effective despite the aggressive politics at the time.”
Now Trump, a combative politician who has tried to upend the institutions of Washington, is expected this week to name Powell as the new chairman of the Federal Reserve, where he serves as a governor. Fed chair is the top job steering America’s economy, and, according to people familiar with the process, Trump has decided to tap Powell for it after deciding against renominating the current Fed chair, Janet L. Yellen, or going in a sharply different direction by tapping Fed critics John Taylor or Kevin Warsh for the job. Prior presidents had typically renominated the sitting Fed chair, especially when the economy was doing well.
In some ways, though, Powell, who goes by the nickname “Jay,” fits the mold of a typical Trump pick for premium post. He’s a Republican …read more
President Trump is expected to nominate Jerome H. Powell as the next chair of the Federal Reserve, according to two people familiar with the president’s decision who spoke on the condition of anonymity.
The White House intends to announce the Fed chair selection on Thursday.
If confirmed by the Senate, Powell would begin serving as chair in February, replacing Janet L. Yellen, a Democrat whom Trump has at times praised but many Republicans wanted replaced.
Powell, a Republican, is widely viewed as a safe pick who is unlikely to make any dramatic changes to the Fed’s handling of the economy at a time when the stock market is soaring and unemployment is at a 16-year low. Unlike some of the other candidates Trump considered, Powell has been supportive of Yellen’s policy of slowly raising interest rates, which have been at historic lows for nearly a decade as the Fed looked to help the economy recover from a massive recession. Trump has expressed interest in keeping rates low as he aims to stimulate the economy and get more Americans higher-paying jobs.
Trump said Friday he has “someone very specific in mind” for the Fed. “It will be a person who, hopefully, will do a fantastic job,” Trump said in a short video message posted on Instagram and Twitter.
The Fed operates independently from the White House. Much as with Supreme Court nominees, once Powell is confirmed, Trump will not have any sway over him, making the choice a critical one because the Fed has the power to help stimulate the economy or slow it down if the central bank governors believe the economy is heating up too quickly.
“The chairman of the Federal Reserve has control of the most powerful lever to influence world prosperity,” says Gary …read more
Young Americans are struggling to come up with down payments.
By Matt O’Brien
One of the most successful politicians in the world just won one of his most important elections, but nobody seems to have noticed. Maybe he should try tweeting more.
I’m talking about Japanese Prime Minister Shinzo Abe. His Liberal Democratic Party just managed to hold on to its two-thirds majority in Japan’s lower house of Parliament, which it needs to be able to amend the country’s constitution, even though a series of scandals had recently pushed Abe’s personal popularity to new lows. It helps when your opposition is weak — and also when your policies have made the economy strong.
Abe — who will host President Trump later this week at the beginning of Trump’s 12-day Asia trip — came into office five years ago with a mandate to jolt Japan’s economy out of its somnolent state. That, at least, was the story he told. Reality, though, was a bit more complicated. Japan, you see, had been the first county to go through the boom, bust and stagnation cycle that the rest of the world has gotten to know and hate so much the past 10 years.
But even that doesn’t give you a sense of how bad things were, or how much worse they could have been. Japan really did have one of the biggest bubbles in history. One story — almost definitely a myth, but one that gives you an idea of how crazy things were — held that the land under Tokyo’s Imperial Palace was at one point valued as more than the entire state of California. Not to mention that Japan’s stock market hit what is still an all-time high of 38,916 back in 1989. It’s only 21,740 today.