After days of criticizing the Federal Reserve’s chief Jerome Powell, U.S. President Donald Trump on Monday said that the United States Central Bank is the economy’s “only problem”.
”The only problem our economy has is the Fed,” Trump tweeted, saying that “they don’t have a feel for the Market”, an approach the U.S. president has asked Powell to take in the past.
He continued, saying “they don’t understand necessary Trade Wars or String Dollars or even Democrat Shutdowns over Borders”, referencing the partial government shutdown that started 12 a.m. on Saturday after Democrats in the Senate would not sign off on a stopgap spending bill that included some $5 billion for a border wall.
The tweet comes amid a steep selloff by U.S. stock markets, with the Dow Jones industrial average experiencing a 400-point drop Monday morning after its worst week in a decade.
The White House is working to stabilize the uncertain markets to no avail. This included an apparent failed attempt by Treasury Secretary Steve Mnuchin who called six major U.S. banks over the weekend, a move largely considered unusual.
Stock markets have typically been strong and rising during the term of President Trump, but the last three months have experienced drops that have frustrated the White House, which claimed the successes of the markets since inauguration.
The Mnuchin Calls
Trump’s treasury secretary released a statement on Sunday morning declaring that the six largest banks have “ample liquidity available for lending to consumer, business markets and all other market operations”, after a call with bank executives.
Mnuchin said that on Monday he will call the White House working group tasked with the economy, made up of federal regulators, to coordinate stabilizing the national financial markets.
The secretary cited “strong economic growth in the U.S. economy with robust activity from consumers and business”, adding that with the partial shutdown in play, the Treasury Department “will have critical employees to maintain its core operations at Fiscal Services, IRS, and other critical functions within the department.”
Financial analysts have been saying the weekend outreach to the banks and the statement that followed backfired, with his actions creating more concern than stability during the holidays.