525: Is Trump’s Takeover of the Fed a Good Thing?

Something big is happening in Washington right now, and it has the potential to reshape everything you and I do as investors. A few weeks ago, the Trump administration attempted to remove Fed Governor Lisa Cook, only to have an appeals court block the move on legal grounds.  At almost the same time, Stephen Miran—one of Trump’s economic advisers—was confirmed by the Senate to the Fed’s Board of Governors by a razor-thin margin.  On one side, an attempted subtraction. On the other, a confirmed addition. All of this is happening right before a major policy meeting, and it’s not hard to see the writing on the wall. Trump’s takeover of the Fed is not a question of if—it’s a question of when. Whether it unfolds in a matter of weeks or drags out over the next few months, the direction is set and the outcome is inevitable.  The endgame is to bring interest rates down and, if necessary, use quantitative easing to drive bond yields even lower. That kind of policy would flood the system with liquidity, and the immediate effect would be a booming economy. Asset prices would rip higher—stocks, real estate, gold, Bitcoin—you name it. If you own assets, you’d feel wealthier almost overnight. But of course, there’s another side to this coin. A dollar that weakens under the weight of easy money. A gap between the asset-rich and the asset-poor that grows even wider. Rising inequality, rising tensions, and perhaps a long-term cost to the credibility of the U.S. financial system. So is this takeover of the Fed a good thing? That depends entirely on where you sit. If you’re a wage earner with no meaningful assets, it’s bad news. If you’re an investor, it’s a reminder that ignoring policy shifts like this is done at your own peril.  The time to prepare is now, not later. Don’t wait for rates to drop before acting. History shows that buying assets in a descending rate environment has been one of the most powerful wealth-creation maneuvers in the United States.  Think back to 2008. The Fed responded to the financial crisis with unprecedented rate cuts and waves of quantitative easing. What followed was more than a decade of explosive gains in stocks, real estate, and other assets.  Those who bought while rates were falling built extraordinary wealth. Those who stood on the sidelines missed out. But don’t take my word. Listen to noted economist Richard Duncan explain the dynamics of this situation in this week’s episode of Wealth Forula Podcast.  Learn more about Richard Duncan: richardduncaneconomics.com Transcript Disclaimer: This transcript was generated by AI and may not be 100% accurate. If you notice any errors or corrections, please email us at phil@wealthformula.com. By devaluing the dollar by 50% against the end of the mark by 1990, the trade deficit that had come back into balance. Welcome everybody. This is Buck Joffrey with the Wealth Formula Podcast. Coming to you from Montecito, California. Uh, today before I begin, just a reminder. Go to wealth formula.com. If you haven't done so and you are an accredited investor, join the Accredited Investor club. Lots of things coming in there in Q4. Lots of tax mitigation, strategy related investments, that kind of thing take advantage a hundred percent. Bonus depreciation, take advantage of discounted assets and so on. So again, wealth formula.com. Now, uh, let's talk about today's show. Interesting one. Um, it's with, uh, Richard Duncan again. Uh, and, uh, he's an interesting guy, uh, and I wanted to talk to him because something big is happening in Washington right now, as you know, and it has the potential to reshape everything you and I do as investors. As you may know, and as I am sure you probably know, a few, a few weeks ago, Trump administration attempted to remove, uh, fed Governor Lisa Cook, only to have appeals. Courts block, uh, and, uh, uh, move block the move on legal grounds. And at almost the same time, Stephen Moran,