Apparently unsatisfied with having branded the Fed “destructive” during a manic phone interview with CNBC on Monday, Donald Trump took to Twitter on Tuesday to lambast America’s central bank for the umpteenth time.
Of all the Bloomberg articles the president could have chosen to illustrate the extent to which relatively hawkish US monetary policy has served to underpin the dollar and undercut the tariffs, Trump decided to target a piece on tourism in Europe.
Even a cursory glance at the article (called “Prepare for Another Summer of Overtourism“) reveals that Leonid Bershidsky is advancing a theory about why it might be beneficial to raise the cost of flying. “Yet none of these policies strike at the main cause of overtourism: the incredible ease and low cost of air travel”, Bershidsky writes, adding that a “2018 EU report contains a checklist meant to help city officials figure out if they’re in danger from overtourism [and] the first question is, ‘Is your destination less than 30 kilometers from an airport?'”
Somehow, Trump managed to turn the story into fodder for his attacks on the Fed.
“This is because the Euro and other currencies are devalued against the dollar, putting the US at a big disadvantage.”, he tweeted, commenting on Bershidsky’s post clearly without having read it.
“The Fed Interest rate way to high, added to ridiculous quantitative tightening!”, the president went on to shriek, misspelling “to” and speaking in caveman parlance. “They don’t have a clue!”
It’s true that someone in this equation “doesn’t have a clue”, only it’s not the Fed – it’s Trump. Because, again, the opinion piece he references has nothing to do with monetary policy. If you word-search the article for “currency”, you get zero results. The same goes for “ECB”.
Trump is simply looking for excuses to assail the Fed ahead of the June policy meeting and he thought he found one in Bershidsky’s piece about overtourism. Who knows, maybe Fox News mentioned it. Or maybe Trump is perturbed that Europe is getting so much tourist traffic.
Whatever the case, this is just another encroachment on central bank independence, with the only saving grace being Trump’s accidental lampooning of himself.