Trump taps 2 allies as Fed board nominees

Donald Trump said Tuesday he intends to nominate two new candidates to the board of the Federal Reserve, which the US president has assailed over its reluctance to lower interest rates.

Both of the president's intended nominees, which he announced on Twitter, are economists who share his cutting opinion of the Fed. He noted in his announcement that both possess doctorates.

"I am pleased to announce that it is my intention to nominate" Christopher Waller, a director of at the Fed's satellite office in St. Louis, Missouri, and conservative economist Judy Shelton, Trump tweeted.

The Fed has a seven-member board, but has had openings for many months.

The last two candidates Trump tapped for the Fed board — conservative economic commentator Stephen Moore and former pizza executive Herman Cain — were so unusual that even several Senate Republicans said confirming them would be out of the question.

Moore, who advised Trump when he was running for president, had faced mounting criticism over his qualifications and past comments, such as complaints that women's wage gains could pose a danger to families by outpacing those of men, which he tried to walk back.

Cain previously served as a board member at the Kansas City Federal Reserve Bank and was a candidate for the Republican Party's nomination in the 2012 presidential election, but he suspended his campaign following allegations of sexual misconduct, which he denied.

Cain and Moore's withdrawals suggested the president had faced difficulty in installing loyalists at the central bank.

Trump has repeatedly ignored norms designed to protect the independent Fed from political influence, and routinely lambasts the central bank and its president Jerome Powell for raising interest rates, claiming it is holding back US economic growth, which he views as key to his re-election in 2020.

As Trump pursues aggressive trade policies that have rattled the global economy, the Fed has sent strong signals that it is prepared to cut interest rates to preserve the record economic expansion.

But Powell has cautioned that current economic warning signs could prove temporary and the US central bank should seek confirmation before taking any policy action.

PhDs

Christopher Waller is a former economics professor at the University of Notre Dame and the director of research at the Federal Reserve Bank of St. Louis. He specializes in financial theory and macroeconomics

Judy Shelton, an outspoken critic of the central bank, is currently US executive director at the European Bank of Reconstruction and Development and has served on the board of Hilton Hotels.

She is an outspoken supporter of low interest rates — she has indicated she supported lowering them to zero percent in one or two years — and often takes to Twitter (@judyshel) to express her views, in a manner most presidential.

In April, she published an editorial in the Wall Street Journal criticizing the Fed's approach in 2008 to combating the economic recession. She also expressed support for returning to the gold standard, a monetary system in which the standard economic unit of account is based on a fixed quantity of gold.

Trump has named three current Fed members to the board, including Vice Chairman Richard Clarida, and also promoted Jerome Powell to his current post as board chair.