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Home / Business / Trump says Fed & # 39; boneheads & # 39; should reduce interest rates to zero & # 39; or less, & # 39; The United States should refinance debt

Trump says Fed & # 39; boneheads & # 39; should reduce interest rates to zero & # 39; or less, & # 39; The United States should refinance debt



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President Donald Trump on Wednesday continued his verbal assaults on the Federal Reserve, which he blames for slowing the economy, tweeting that the central bank should reduce interest rates to zero or even set negative interest rates. The president also called Fed officials for "boneheads" in the tweet.

"The Federal Reserve should get our interest rates down to zero, or less, and we should then start refinancing our debts.

The president also came up with a new proposal that was not seen in any of his previous attacks on the Fed, saying that the country should refinance its debt load.

unclear how such an idea would work. The Treasury Department probably had to be involved, and there have been calls lately to issue long-term debt, such as a 50- or 1

00-year Treasury.

Trump had made a proposal during the 2016 presidential campaign that would have involved debt renegotiation. That idea was then rejected as a move that could actually result in higher Treasury yields, threatened the nation's status among creditors and posed a threat to the US dollar as the world's reserve currency.

During a CNBC interview in May 2016, Trump said that if the economy turned south, he would try to get creditors to accept partial payment of US debt.

"I would lend, knowing that if the economy crashed, you could make a deal," he said then. [19659003] His idea was that the United States would pay less than the face value of the Treasury it issues to cover the growing budget deficit. However, doing so would only increase the cost of issuing the debt, as creditors would demand higher interest payments.

Trump has long lamented the Fed policy, saying that the central bank should come more in line with the near-zero rates as the country's global competitors. The Fed is currently targeting its overnight lending rate in the range of 2% to 2.25%, the highest of any G-7 nations.

In previous tweets, he has repeatedly withdrawn his own appointed Fed Chairman Jerome Powell, as being out of step with the economic needs of the United States

"The United States should always pay the lowest rate. No inflation! It's just the naivety of Jay Powell and the Federal Reserve that won't allow us to do what another country is doing already. An opportunity in life that we lack because of the "Boneheads," Trump said in Wednesday's tweets.


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