Only when it occurred to [Trump] that Janet Yellen was doing everything possible to insure Clinton’s victory did he let loose an attack on the Fed. In his famous warning, he leveled that America was threatened by a big, fat, ugly bubble.
Unfortunately, there was never even a hint of policy content behind this campaign statement. It said nothing of a coherent plan to liberate the American economy from the nation’s central bank.
When Wall Street launched a phony Trump Reflation trade during the wee hours of election night, the Donald forgot all about the great bubble. In fact, he quickly embraced it as a sign that investors were enthusiastically embracing Trump-O-Nomics.
No new arrival in the Oval Office was ever more mistaken… He needed to quickly puncture the bubble, not embrace it; and his first, second and third actions on the economic policy front should have been to clean house at the Fed.
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Instead, the Donald got off-track from the get-go with aiming his efforts against immigrants and refugees; nonsense about the Mexican border; and the hideously bloated Pentagon budget. While all of that was bad, the Donald’s fatal error was delegating economic policy to Wall Street errand boys. Trump handed economic power to Steve Mnuchin, Wilbur Ross and Goldman Sachs’ next-in-line gatekeeper to Washington, Gary Cohn.