Come January, President-elect Donald Trump – the self-described ‘king of builders’ – will be faced with a unique re-modeling opportunity that’s nearly exclusive to him – completely reshaping the Federal Reserve.
There are currently two vacant positions on the Federal Reserve Board of Governors, the main governing body of the central bank. Chairwoman Janet Yellen and Vice-Chair Stanley Fischer’s terms will expire by 2018. This means that should Yellen and Fischer follow custom and concede their board seats, Trump will have the opportunity to replace four of the Fed’s seven leading officials with conservative figures during his presidency.
And that’s a big deal.
Board members serve 14-year terms, and there have been very few times in history where more than two board vacancies have come in a single presidential term. In truth, Trump has a nearly unprecedented opportunity to shift the direction of monetary policy towards a more conservative direction.
Although Trump has occasionally appeared to embrace the status quo with respect to monetary policy, he has also been rather candid in his views of the current Fed.
This post was published at Lew Rockwell on November 22, 2016.
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