President orders American companies to look for 'alternatives to China'
U.S. President Donald Trump on Friday took a shot at Federal Reserve Chairman Jerome Powell by questioning whether he or Chinese President Xi Xinping is the "bigger enemy" to Washington.
"My only question is, who is our bigger enemy, Jay Powel or Chairman Xi?" Trump tweeted, misspelling the central bank president’s name.
It came hours after Powell gave a speech where he promised to act appropriately in order to sustain the expansion of the U.S. economy, while acknowledging tariffs and other factors have contributed to slow economic growth.
"As usual, the Fed did NOTHING! It is incredible that they can ‘speak’ without knowing or asking what I am doing, which will be announced shortly. We have a very strong dollar and a very weak Fed. I will work ‘brilliantly’ with both, and the U.S. will do great," Trump said in an earlier tweet.
The president has been highly critical of Powell, who Trump picked to lead the Federal Reserve, saying that he has raised interest rates too quickly.
Trump has insisted the American economy is strong and only faces one problem, the central bank.
The president said the biggest thing that could be done to boost the economy would be if the Fed cut interest rates by a minimum of 100 basis points and instituted quantitative easing, saying the impact would create "a burst of growth like you've never seen before."
"We actually are set for a tremendous surge of growth if the Fed would do its job," he said.
The Fed lowers interest rates to stimulate economic growth, as lower financing encourages borrowing and investing. Quantitative easing is a monetary policy where a central bank buys predetermined amounts of government bonds or other financial assets in order to inject liquidity directly into the economy.
Concerns have been mounting that the U.S. could be nearing recession amid a trade war with China that has no end in sight and a worrying economic indicator that arose last week which normally precedes a recession.
Trump has said that the current trade war with China will not negatively affect the economy, even though many economists and members of the Federal Reserve disagree.
China on Friday announced new tariffs on $75 billion worth of U.S. goods, including automobiles, and will take effect in two waves --Sept. 1 and Dec. 15.
Trump responded to the tariffs announcement on Twitter, saying that he orders American companies to look for "alternatives to China".
"The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP," Trump tweeted.
"Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA."
