As we pointed out here last week, some resistance is brewing to President Donald Trump’s recent nomination of economist Judy Shelton to the Federal Reserve’s board of governors.
Shelton, once U.S. envoy to the European Bank for Reconstruction and Development and an informal Trump advisor to his 2016 campaign, has pushed for returning to some kind of gold standard, a relatively unorthodox view among economists. Shelton appears to be somewhat lukewarm on Fed’s independence from the executive branch and defended Mr. Trump’s call for lower interest rates, reversing her years of calls for higher rates.
Despite being of the president’s party, two senior Republican senators expressed concerns in testimony last week in Senate banking committee testimony. According to press reports, this might cloud her prospects.
Senator Pat Toomey of Pennsylvania was critical of views that the dollar is too strong and that it is the job of the Fed to pursue devaluation, calling it a “dangerous path,” when questioning Shelton in the Senate Banking Committee.Fellow Republican Richard Shelby of Alabama simply said he was “concerned,” according to the Wall Street Journal. Neither has indicated which way he will vote but it does suggest, as both are senior members of the commi...