Our Questions, and Yours

Briefing|Our Questions, and Yours

Today, we’ve answering five questions about the news unfolding in Washington, the Vatican and Harvard Square — with help from beat reporters across the newsroom. Many of these questions came from you. Send us your questions about the news with this form.

1. Can Trump fire the Fed chair?

The leader of America’s central bank, the Federal Reserve, is supposed to guard against rising inflation, which economists say may be imminent. For that reason, he won’t lower interest rates to boost economic growth (which would speed up inflation). That frustrates President Trump — every president looks better when the economy booms. Trump has mused in recent days about ousting Jerome Powell, the head of the Fed, although yesterday the president said he had “no intention” of firing him.

Trump’s talk infringes on the central bank’s longstanding political independence, writes Colby Smith, who covers the Fed. When Congress set up the Federal Reserve, lawmakers hoped to shield it from political influence so it could make difficult decisions that might cause short-term economic pain. In the 1980s, for instance, the Fed deliberately tanked the economy to get inflation under control.

Still, the president can fire board members of independent agencies “for cause.” Trump could try to argue that Powell has failed at his job and fire him.

In the end, the markets might hold back Trump more than the law does. When investors worldwide put their money into the United States, they’re committing an act of faith — that the economy will continue to grow and prosper through proper leadership. Trump has challenged that faith by threatening the Fed’s independence. That’s why stocks fell after Trump’s initial comments.

For more: Markets rebounded after Trump said he had no plans to oust Powell.

2. Is ‘Conclave’ accurate about selecting a pope?