Cutting Through the Fed’s Orwellian Doublethink

Governor Jerome H. Powell (and President Trump’s nominee for chairman) testifies before a joint hearing of the Senate Banking Subcommittee on Securities, Insurance, and Investments and the Subcommittee on Economic Policy in Washington on April 14, 2016. (Federal Reserve)

Federal Reserve Board Governor Jerome Powell, who has been nominated by Donald Trump to succeed Janet Yellen as the next Federal Reserve chairman, is an unusual choice for a number of reasons. First, Powell is not an academic economist but rather an investment banker who understands the financial markets. Second, unlike his tight-lipped predecessors going back several decades to Paul Volcker, Powell is quite forthright in his public statements.

For example, in the October 2012 Minutes of the Federal Open Market Committee, Powell openly worried about how the Fed’s massive purchases of securities would impact the markets. He said:

[W]hen it is time for us to sell, or even to stop buying, the response could be quite…

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