The Fed’s choice of Trump on the hot button in the face of Senate committee vote this week


One question analysts are pondering is which version of Ms. Shelton will run for work at the Fed if she gets the job: a promoter of the gold standard, or not? A supporter of low rates, as it was during Mr. Trump’s administration, or an inflation hawk?

“That leaves open the question of what exactly it would look like at the Fed,” said Sarah Binder, a Brookings Institution scholar who wrote a book on central bank policy. She stressed that Ms Shelton’s unusual ideas were likely to find little buy from her colleagues and that individual governors could not have much of an impact on their own.

“You can really imagine her leaning over windmills,” Ms. Binder said.

The question of whether Ms. Shelton would become the pending Fed chair appears to be the key. Mr. Trump spent 2018 and 2019 publicly criticizing Mr. Powell, although that criticism has diminished during the current crisis. If Mr. Trump were re-elected, Ms. Shelton could be a potential replacement for Mr. Powell, as governors are often promoted to senior positions.

“She could do real damage on her own as president,” said David Wilcox, a former research director at the Fed.

He also said he was concerned it might hamper the response to the coronavirus crisis. “In times of crisis, there is simply no time to revisit ideas that have been left in the trash of history,” said Wilcox.

Ms. Shelton would occupy a seat previously held by Janet L. Yellen; the unexpired term would be renewed in 2024. Mr Waller would occupy a seat previously held by Ms Bloom Raskin, whose term expired in 2026.

While none of the nominees would wield much influence as an independent governor, their confirmations would give Mr. Trump his hand-picked choices for six of the board’s seven positions. Lael Brainard was appointed governor by President Barack Obama, and although Mr. Powell was appointed to the board of directors by Mr. Obama, Mr. Trump raised him to the presidency.


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