The US economy is decelerating rapidly with growth likely to drop from a rate of over 3% into the 1-2% range as the effects of the Fed’s ultra-tight monetary policy impacts the residential and commercialconstruction industries.
Q4 GDP grew only 2.3% with the critical investment sector contracting at over a 1% annual rate.
January Retail sales declined by .8%.
Recent layoffs of Federal workers is material with almost 100k layoffs and firings and will likely impact the February and March employment reports.
The current Fed is very dangerous as it slavishly follows a price index that is delayed by two years due to the flawed calculation of the critical shelter component and follows a 2% target that is too low and caused the Great Financial Crisis. This rigid approach makes it likely that the Fed will make yet another policy error by being too restrictive in the face of declining growth. Inflation is already contained with real time PCE Core inflation already at the Fed’s arbitrary 2% target.
The President definitely has the authority to fire the Fed Chair for cause based on his neglect of duty and incompetence in allowing the Great Inflation while advocating for high government spending and developing the “Transitory” theory of inflation.
An appointed agency official with a fixed term cannot be removed by the President early from office simply because the official disagrees with the President but can be removed for cause.
The law specifies that cause can be inefficiency, neglect of duty, or malfeasance in office (INM).
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