Chapter 1: What actions is President Trump taking against Jerome Powell?
The Trump DOJ seems to be targeting Fed Chair Jerome Powell. What's going on with that? Plus, we're joined by a vice admiral to talk about the latest in Iran and a spokesperson for the Department of Homeland Security to explain what ICE is doing in Minnesota. First, why do people just like you become DailyWare Plus members?
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People join because this isn't just a subscription, it's community. People watching together, reading together, laughing, debating, pushing back, refusing to shut up or sit down. Go to dailywireplus.com and join right now. Well, everyone in the world of economics and in the markets is talking about President Trump's DOJ going after Jerome Powell, the Federal Reserve chairman.
Now, again, Jerome Powell is leaving the Fed chairmanship next year anyway. And not only that, he is leaving the Federal Reserve entirely in January of twenty twenty eight. So it's somewhat confusing as to why the DOJ is going after Jerome Powell if all they have on him is that there are cost overruns in the rebuilding and reconstruction of the Federal Reserve building. Nonetheless,
The controversy is hot and heavy today. According to the Wall Street Journal, for years, Federal Reserve Chair Jerome Powell responded to President Trump's broad ties in ways that generally avoided escalation. That changed on Sunday night.
In an extraordinary two-minute video message, Powell accused the administration of using the threat of criminal prosecution to pressure the Fed into lowering rates. He framed the Justice Department investigation as nothing less than a head-on challenge to the Fed's ability to operate free of political control. And of course, he is not the first
Federal Reserve board member to be targeted by the DOJ. Lisa Cook has also been targeted by the DOJ over supposedly misfiling her mortgage forms, falsifying that it was a second mortgage when it was actually a first mortgage or whatever the case is.
The point that Powell is making is that it's kind of weird that the only people who seem to be cropping up in the DOJ list of people to investigate are people who are opposed to President Trump's agenda, which is lowering those interest rates. Now, as I've said before, artificially low interest rates are not a good thing.
I understand that we've lived with those for a very long time in the United States. It's why everybody has a 3.5% mortgage. But the reality is that the interest rate, if it were allowed to free flow, if it were allowed to float where it should be, would actually ensure less uncreditworthiness in the market. It would prevent speculation.
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Chapter 2: How is the DOJ's investigation of Powell perceived politically?
The decision to disclose the investigation appeared to reflect a belief that the public should know what was unfolding. The threat of prosecution of a sitting Fed chair would be material information for investors or anyone else trying to understand the forces shaping interest rates deliberations.
Now, President Trump is claiming he didn't know about the DOJ subpoenas and that any criminal investigation would not be related to disagreements that the White House actually had with Powell over the interest rates. And a lot of allies of the president are not particularly happy about all of this. They see this as needlessly chaotic.
According to Politico, a growing number of Republicans on Capitol Hill are expressing unease with the DOJ's move to investigate Jerome Powell. According to House Financial Services Chair French Hill of Arkansas, he said that this creates an unnecessary distraction that could undermine this and future administration's ability to make sound monetary policy decisions.
Quote, I've known Chairman Powell since we worked together at Treasury during the George H.W. Bush administration, then as now, I know Mr. Powell to be a man of integrity with a strong commitment to public service. While over the years we've had our policy disagreements, I found him to be forthright, candid, and a person of the highest integrity.
Senator Kevin Cramer, Republican of North Dakota, called Powell a bad Fed chair who has been elusive with Congress, especially regarding the overruns of the elaborate renovations of the building. I do not believe, however, he is a criminal. Again, Cramer is a strong ally of President Trump.
He said, I hope this criminal investigation can be put to rest quickly, along with the remainder of Jerome Powell's term. We need to restore confidence in the Fed. Senator Lisa Murkowski of Alaska, who, again, is a sort of purpley senator. She tends to vote more often with the Democrats. She wrote that the administration's investigation is nothing more than an attempt at coercion.
And added, if the DOJ believes an investigation into Chair Powell is warranted based on project cost overruns, which aren't unusual, then Congress needs to investigate the DOJ. The stakes are too high to look the other way. If the Federal Reserve loses its independence, the stability of our markets and the broader economy will suffer. And again,
This sort of stuff is not salutary for Republican chances in the midterms. It isn't. What Americans are looking for right now is a feeling of solidity. They want to feel as though things are moving in the right direction, that they are not standing on shifting sands all the time.
And what the polling shows right now is that people are increasingly not just moving away from Republicans, they're moving away from both parties, actually. Brand new Gallup polling shows 45% of Americans, the highest in recorded history, now identify as political independents. Now, that doesn't mean they're not voting Republican or Democrat.
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Chapter 3: What are the implications of low interest rates on the economy?
And the president injecting, I would say, needless chaos into the economic system is not a great idea, particularly because, again, there are a lot of indicators that things are going pretty well. CNN reported, for example, that the mortgage rates have now dropped below 6%.
Again, that's not three and a half, but it's certainly well below the eight or 9% that seemed to be the rule of the day during the Biden administration.
Mortgage rates on Friday fell below 6% for the first time in years, and this comes after the president ordered his quote-unquote representatives to begin buying $200 billion worth of mortgage bonds. What are you hearing about this move? So at first, we actually did see yields coming down, and that's exactly what the administration wanted.
And it was interesting because the bond market sort of waited a bit to suss out how they felt about this, and then you had investors coming in and saying, okay, let's move rates down. But then after this Powell investigation dropped over the weekend, we have the exact opposite effect happening.
The market has already undone all of the good of lower rates that happened off the back of that $200 billion mortgage bond purchase announcement.
Now, with that said, again, mortgage rates being lower is a good thing. It means that people can get a mortgage more easily. Meanwhile, it turns out that, as we've been noting, there's been a lot of talk about affordability.
And one of the things that I have been pushing for a while, and that, of course, has now been taken out of context repeatedly, is the idea that rents are not the same everywhere. Rents are not the same in Manhattan as they are in Austin, Texas. And it seems that actually a bunch of the Sunbelt cities, the rents have not only been coming down, even with regards to, say, luxury apartments,
Rents have been coming down and concessions have been going up. According to the Wall Street Journal, about 54% of rentals in the Phoenix metro area are giving tenants at least one month off their rent. Why?
Well, because builders saw that there was a movement of population into Phoenix and those evil, terrible corporations then built a bunch of luxury apartments and then fewer people than expected showed up and then the rents went down. See how that works? When you increase the supply and the demand stabilizes, then the price goes down. I know, shocking.
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Chapter 4: How does the Federal Reserve's independence affect monetary policy?
Apparently, Apple has now chosen Google's Gemini to power Siri. So that'll make Siri a hell of a lot better. It also means that Gemini now has a leg up. Gemini is incredible. It's in heavy competition with ChatGPT right now as the best technology. AI chatbot that is available today, the best LLM available today. Gemini seems to be growing by leaps and bounds.
Well, if, let's say, Gemini were to out-compete OpenAI so thoroughly that OpenAI were to start to fall apart, that could have some knock-on effects to the broader economy. Doesn't mean that AI is a bubble. Does mean that there are certain competitors who could theoretically lose.
When competitors lose and there's a consolidation in the market, depends if there's bleed over to other companies as well. So we'll definitely be keeping an eye on that. Meanwhile, the other big story of the day, of course, is the continuation of chaos surrounding what's going on with ICE. Obviously, the anger is palpable in places like Minneapolis.
People don't believe they're breaking the law even when they're breaking the law. If you get in the way of ICE officials who are attempting to pursue a federal operation, you are in fact violating federal law and you will get yourself into hot water, according to the Washington Post. They say they're monitoring ICE arrests. Feds say they are breaking the law.
They're talking here about a lot of these sort of ICE watch groups. The fatal shooting of Renee Good last week, says the Washington Post, as ICE officers and residents faced off on a residential street here has brought new attention to these sorts of activities. Federal court rulings say citizens can observe and record police activity in public areas as part of their First Amendment rights.
Many of the observers are doing nothing more than that. But as officers and agents employ aggressive tactics, some activists have blown whistles to warn community members of approaching law enforcement, try to follow immigration enforcement vehicles, or use their own cars to block the roadways that enters murkier legal territory.
Some legal experts said such behavior could in theory justify obstruction of justice charges. Well, that's particularly true if you're taking your car and literally blocking ICE agents from getting to the place they need to be. Officials throughout the Department of Homeland Security are vowing to prosecute anybody who interferes with an operation or endangers an officer.
Joining us on the line to discuss is Tricia McLaughlin. She's Assistant Secretary for Public Affairs for Homeland Security. Thanks so much for taking the time. Really appreciate it.
Ben, thank you for having me.
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Chapter 5: What is the current economic situation in the U.S.?
that we've seen and that Homeland Security investigations are investigating. And so I think that there is a part of this where they're trying to circle the wagons and really use this as a smoke screen so people stop talking about the fraud.
Now, Tricia, one of the things that really is sort of unnoted in all of this is the fact that the number of deportations from red states actually, in many cases, outnumbers the number of deportations from blue states. The difference is that the blue state governors are trying to obstruct and sanctuary city mayors are trying to obstruct in these blue areas.
In red states, if they cooperate with ICE, then these operations tend to go off pretty easily without a hitch. And then the deportations are actually pretty sizable. So it is not as though the Trump administration is only targeting blue areas of blue states. A huge number of deportations are happening in red states in red areas.
Oh, completely. I mean, you look at Louisiana, we have a large scale operation in New Orleans where we have a governor who's cooperating with us. We have law enforcement who's cooperating with us. That makes it a lot safer, not just for our law enforcement, but for the public on the ground as well.
Because when things when we start to have agitators, we start to have riders, people who are impeding operations or assaulting law enforcement online. our law enforcement are able to call local and state officials for backup. And that really makes sure that there aren't these dangerous situations that spin out of control.
But you'll also, a lot of your viewers will have seen in the news that we have surge CBP law enforcement on the ground there to Minneapolis. A lot of that is so that we can make sure that we are quelling any violence that we see from these violent agitators, we're seeing things get more and more coordinated, more and more people
coming on the ground and using tactics like vehicle rammings and assault against law enforcement. So we still need to conduct operations in Minneapolis and other blue states around the country. And so what we're going to do, we have to bring more men and women on the ground to ensure they can still conduct these operations, but do so in a safe and orderly fashion.
Well, that's Tricia McLaughlin. She's Assistant Secretary for Public Affairs at Department of Homeland Security. Tricia, thanks so much for your time. Really appreciate it.
Thank you, Ben.
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