As you’ve probably noticed over the past couple of days, the novelty/comedic value attached to Stephen Moore’s Fed nomination has worn off and given way to incredulity, irritation, frustration and, in some circles, outright disgust.
Initially, Trump’s decision to (potentially) nominate Moore was seen as just the latest manifestation of the president’s penchant for simple-mindedness and vulnerability to being duped by flattery into giving laughably unqualified people important jobs.
Gradually, though, folks have come around to the peril inherent in letting Moore’s nomination proceed. Stephen is famously idiotic. There is no sense in which he is qualified to be on the Fed board, something even he seems to realize. For instance, on a number of occasions over the past two weeks, he’s confessed he doesn’t really know all that much about monetary policy, an admission that stands in stark contrast to his unswerving criticism of the December rate hike which, at the time, he suggested was grounds for Jerome Powell to be fired.
More on Moore
The Unfathomable Stupidity Of Stephen Moore
Stephen Moore Calls For Immediate 50bp Rate Cut, Was ‘Really Furious’ At Jerome Powell In December
Stephen Moore Tells Fox We Need Rate Cuts, Requires Access To Secret Fed Data To Determine How Many
In a testament to just how far afield we are, Trump’s other recent Fed pick, Herman Cain, is actually more qualified than Moore despite being a legendary buffoon himself (Moore actually advised Cain at one point, thus completing the circle of idiocy).
We haven’t talked as much about Cain’s potential nomination because, frankly, we said everything there was to say about it in terms of jokes back when the news first broke in January and also because we thought it unlikely that Cain would ultimately be confirmed. As of Thursday evening, Cain was said to be on the verge of withdrawing his name from consideration after four Republican Senators virtually doomed his nomination by indicating they’d likely oppose it.
The GOP should do the same for Moore.
Cain’s nomination was always ridiculous (as you’ll see if you read the linked post above, the punchlines literally write themselves), but Moore’s is flat-out dangerous.
It is by no means clear that Stephen possesses the intellectual capacity to function on the board even if he were to somehow manage to extricate himself from the president’s ass, which he clearly isn’t inclined to do. Point being: Stephen Moore is famously stupid. Cain has a lot of calling cards, some of which are decidedly dubious, but “outright imbecile” isn’t really one of them or if it is, it’s not the only one, whereas Stephen’s entire claim to fame is that he isn’t smart.
Erin Burnett underscored all of the above in one fell swoop on Thursday evening when she interviewed Moore. Very much unlike her former CNBC colleague Maria Bartiromo, Burnett didn’t let Stephen off the hook. Watch this rather painful clip:
That, right there, is why Stephen Moore cannot be allowed anywhere near the Fed and on Friday, he got an earful from one of the last people you want to hear from if you’re a moron – Elizabeth Warren.
In an 8-page letter containing some 40 citations, Warren absolutely shreds Stephen. Here’s an example:
For one, you have repeatedly made substantive, inaccurate claims about important aspects of the economy, which would be under your purview if confirmed to the Board of Governors… I am concerned that some of your public statements demonstrate a carelessness with economic facts that could negatively affect the economy if you were confirmed….But politics seems to be the primary basis of many of your confident, if inaccurate, pronouncements about the economy and economic policy.
Ultimately, Warren demands that Moore produce answers to 9 questions “no later than April 26”. This is necessary because, to quote Warren, Congress needs to “better understand [Moore’s] long history of false, contradictory, and apparently politically motivated statements, as well other statements that call into question [his] economic expertise and judgment.” Here are those questions:
- On November 28, 2018, you stated that Federal Reserve “should not have the mandate of getting to full employment. “37 a. Do you maintain this view today? b. If so, how will it affect your actions and statements if you are confirmed as a member of the Board of Governors? c. Which economists share this view?
- In August 2016, you stated, “I am not an expert on monetary policy.”38 a. Do you hold the same view today? b. If not, how do you account for this shift in your views? c. Do you believe that the country is best served by having someone who is an expert on monetary policy, or someone who is not an expert on monetary policy, on the Board of Governors?
- In September 2015-less than five years ago-you stated, “we have got to get rid of the Federal Reserve and move towards a gold standard in this country.”39 a. Do you still hold this view? b. If not, why did you change your mind? c. If so, which economists share this view?
- You have recently expressed strong support for the Federal Reserve to lower interest rates. At any point during the Obama administration, which started just months into one of the worst financial crises in American history, did you advocate for lower interest rates or expansionary monetary policy in any other form? a. If not, why not?
- Do you believe that the United States economy is experiencing deflation, or has within the last two years? a. If so, what data supports this view? b. Which economists share this view?
- Do you believe that the 2012 Kansas tax cuts provided an “immediate and lasting boost” to the Kansas economy? a. If not, how have you revised your prior assumptions about the effects of similar policies? b. What was the basis for the statement you made in May 2013, less than six months after the tax cuts were implemented, that they had resulted in economic growth?40
- Do you believe that the Federal Reserve should link monetary policy to commodity prices? Why or why not?
- Do you believe that the Federal Reserve should pursue full employment? Why or why not?
- Do you believe that the President of the United States should fire a Federal Reserve Chairman due to disagreements over policy?
Having seen how Stephen held up under questioning from Erin Burnett, how do you imagine he’s going to do if/when he finds himself staring up at Elizabeth Warren on Capitol Hill? The answer is: About like everyone else does when placed in that same situation, only far worse because this is Stephen Moore.
Read Warren’s full, blistering letter to Moore below and we dare you get through it without laughing at the prospect of Moore trying to respond to her in person.
WarrenMooreLetter
Moore has been on Real Time on many occasions. He has this smirk on his face every time he talks as if to say, “This is pure bullshit folks.” The word idiot fits him perfectly. And speaking of Real Time, Maher, although I think he means well, is getting old. Many of his ideas are quite reactionary and not well researched.
The sad thing is that the FED doesn’t know what money is. But Greenspan admitted as much long ago. There is a big difference between admitting lack of knowledge and acting like a lot of crazy things are true. These are dangerous times because political forces beyond Moore could cripple our economy. In fact it seems true that they already are doing just that. The markets will price that when liquidity normalizes.
I mean, if you are going to deregulate and subsidize the banks, print money, buy crap assets to blow up the balance sheet, run a constant, political pro-cyclical interest rate policy that suppresses savers, abides bubbles in housing and asset inflation, destroys price discovery, and polarizes wealth, at least do so with the decency of having a PhD in Economics.
Harvey, this is yet another silly comment from you parroting the same old line that could have been pulled directly from a blog run by someone selling gold coins and railing against the “establishment”. There’s no nuance here, Harvey. This ain’t one of those cases were you’re going to be able to play “gotcha” with me or any other commenters on here. Stephen Moore is a stone, cold idiot and always has been. If you are willing to defend him (implicitly or explicitly) then either 1) you don’t know anything about Stephen Moore, a situation I suggest you remedy post haste in order to get a handle on this discussion, or 2) you’re not as smart as you seem.
I’ll let you explain which one of those two things is the case or, more likely, respond with a long-winded diatribe about how you weren’t actually defending Stephen Moore, but rather simply reiterating your (largely misguided) opinion that central banks are somehow unaware of the consequences of their policies and/or haven’t conducted a cost/benefit analysis to determine whether the side effects are worth it in their estimation.
Knock yourself out.
I am sure you have access to far, far more financial information than I do, and yet you lack a lot of imagination – even for a person whose financial analysis is colored by political science. Why are you binary? If I do not support the Fed buying mortgage-backed securities, I must therefore support the gold standard or something? Huzzah? You know, there are a spectrum of options in between, right? Economics isn’t my fastball, but I am aware of the Austrian school, yes, and also monetary theory and neo-Marxism and Keynesianism and neoliberalism and maybe a couple of other things besides.
Is Stephen Moore an idiot? Yeah. Is he a Trump sycophant, the absolute worst kind of American? Yes. Yes, he is. But policy matters, and substantively, there will be a dime’s width of difference between a Fed Board composed of idiotic political appointees and a Fed Board composed of political appointees with Economics doctorates. Rates will be too low for too long. Bubbles will grow in housing and stocks. Money will be created to purchase junk assets and finance government debt used to pay for kit we don’t need (plus goon squads and kiddie kennels) and the Fed will panic with every 5% downturn in the NASDAQ. The power or idiocy of the verbiage used to justify all this is wholly irrelevant.
“I am sure you have access to far, far more financial information than I do.”
Right.
“Economics isn’t my fastball”
Ok.
Also this: “But policy matters, and substantively, there will be a dime’s width of difference between a Fed Board composed of idiotic political appointees and a Fed Board composed of political appointees with Economics doctorates.”…. is just wrong. Go and look at what Stephen Moore suggested the Fed do during the Obama administration, for instance. Or better yet, read Elizabeth Warren’s letter.
I’m not going to respond to your comments anymore Harvey. Frankly, your obsession with a narrative that you pretty clearly grabbed from silly websites (and yes, Austrian school websites in many cases qualify as profoundly silly places), suggests you are predisposed to buying into antiquated theories that, irrespective of their “fundamental” soundness or ostensible appeals to common sense, aren’t in operation, will never (ever, ever, ever) be adopted again in any broad sense, and are thus wholly irrelevant.
I may be completely wrong about this, but I would just emphasize for the umpteenth time that the things you say sound like they are copy/pasted from some of the worst kinds of financial blogs and/or from the silliest of silly financial Twitter feeds. Again, you may not read any other blogs and you may not even have Twitter, and in that case I suppose you just share a natural affinity with those types of portals/accounts, but if I am any semblance of correct, you should note that none of those blogs/twitter handles/etc. are taken any semblance of serious by anyone of any consequence and there are really – really – good reasons for that blanket dismissal beyond the reasons that you might be familiar with. Again, you may be wholly unaware of what I mean there, but I personally guarantee you that other readers who read this response of mine know precisely what I’m talking about.
None of that is to say that post-crisis monetary policy shouldn’t be criticized/critiqued etc., and it’s certainly not to suggest that price discovery hasn’t been impaired or that inequality hasn’t been perpetuated. But this ridiculous narrative where PhD economists are painted as villains in some kind of international financial soap opera/drama/crime thriller is so far removed from reality that I struggle to find the right words to communicate how ridiculous it is.
That cabal of super serious, important and relevant people, the ones the ‘other readers’ know about, do they consider the President of the United States as a person of consequence? Because as much as they may laugh and snicker at Stephen Moore, Trump and 51 Republicans have the power to appoint Moore and none of them do. And if Moore is forced to withdraw himself from consideration, what caliber of person do you think Trump is going to nominate to replace him?
You are Straw Man-ing my positions. I think the Fed sucks at monetary policy. I think rates are too low, banks should not have been capitalized with zero interest loans, the bank stress tests are too weak, that the Fed should not buy MBS, and that the stock market is overpriced and too reliant on dovish Fed policy, and buying trillions in Treasuries has killed the bond markets. I guess this makes me some sort of tinfoil hat-wearing whackadoo or something. Our future is Europe, and Japan beyond that, and I disagree with that path and reserve my right to do so.
Lol Moore’s interview. It’s like he doesn’t understand the core concepts of inflation, floating currency, or even a Fed funds rate.
Cause Fed doesn’t look at changes in prices of commodities (goods?) to make informed decisions on rates in order to move the USD. Yep, we really need a peg to do that, right Moore?!