Trump’s Hassett Hesitation, Weighing Credit Card Action, More

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What is the main topic discussed in this episode?

Stephanie Flanders 0:00
Donald Trump is rewriting the Washington rulebook and reshaping the global economy. If you're trying to connect the dots behind the headlines, Bloomberg's Trumponomics podcast is here to help. I'm Stephanie Flanders, Head of Government and Economics at Bloomberg. Every week I'll bring you a smart, focused conversation with reporters and experts from Washington, Wall Street and beyond. Listen to new episodes every Wednesday and follow Trumponomics wherever you listen.
Ed Kalecki 0:31
News when you want it. With Bloomberg News Now, I'm Ed Kalecki. President Trump has expressed reluctance toward nominating Kevin Hassett as Federal Reserve Chair, casting further doubt over his search for the next head of the central bank. Trump on Friday said if Hassett were to leave his post as Director of the White House National Economic Council, it would deprive the administration of one of its most powerful messengers on the economy.
Kevin Hassett 0:55
I actually want to keep you where you are if you want to know the truth. Kevin Hassett is so good. If I move them, these Fed guys, certainly the one we have now, they don't talk much. I would lose you. It's a serious concern to me. So I just want to say thank you very much. You've done incredible.
Ed Kalecki 1:11
Hassett has been seen as a top contender to succeed Fed Chair Jerome Powell. Gold slipped the most in more than two weeks after President Trump expressed reluctance over nominating Hassett as Federal Reserve Chair, casting further doubt over his search for the next head of the central bank. During an appearance on Fox Business, Treasury Secretary Scott Besant talked about when we may learn of President Trump's choice to lead the Fed.
Scott Besant 1:34
We've run a process and it will be the president's decision in the next couple of days or weeks. I'd expected that we would here have a decision either before he leaves for Davos or when he returns.
Ed Kalecki 1:46
Meanwhile, Federal Reserve Vice Chair Philip Jefferson said interest rates are near the level that neither slows nor stimulates the economy, leaving officials in a good place to respond to evolving risks. Jefferson joins a growing group of officials who, following three rate cuts to close out 2025, have declared the Fed's current rate setting is well-positioned to balance the risks to both employment and inflation. The White House is weighing in executive action to enact President Trump's call for a cap on credit card interest rates, in addition to other measures seeking to ease U.S. affordability challenges. The plan, which is still being crafted as administration officials discuss the terms with industry and Congress, is designed to address on credit cards as part of a broader push to reduce costs for Americans.
Ed Kalecki 2:29
Trump's action may also call on regulators to relax certain liquidity standards to help make the plan more attractive for the banks. The Department of Justice is investigating both Minnesota Governor Tim Walz and Minneapolis Mayor Jacob Fry over an alleged conspiracy to impede a federal immigration agent. Meanwhile, President Trump told reporters Friday he would hold off on invoking the Insurrection Act after previously threatening to use the law to deploy military troops in Minnesota. Still, the president did not rule out using the 19th century law at a later date, saying, if I needed it, I'd use it. A day earlier, Trump posted on social media that that he would institute the Insurrection Act if the state's leaders failed to quell protests there.
Ed Kalecki 3:10
The 1807 statute allows the president to use regular military troops on U.S. soil for domestic law enforcement during an insurrection or civil disturbance without congressional approval.

What are the implications of Trump's reluctance to nominate Kevin Hassett as Fed Chair?

Ed Kalecki 3:22
It was last invoked during the 1992 Los Angeles riots. The Supreme Court has agreed to hear Bayer's appeal, taking aim at thousands of lawsuits targeting its top-selling Roundup weed killer for causing cancer. The high court agreed Friday to hear Bayer's challenge to a $1.25 million Missouri jury verdict against the company's Monsanto unit over Roundup on the grounds some of the claims in the 2023 case were preempted by federal law.

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