NEC's Hassett Teases 'Big' Housing Announcement From Trump

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There's debate at Davos about the American economy. European leaders feel existential threat from rhetoric about Greenland. Are you worried about European consumers boycotting American products?

Annmarie Hordern

Kevin Hassett

The US economy is booming with GDP quarters north of 5%. Tariffs didn't cause inflation or recession as predicted. Countries with US trade deals had best stock market years ever. President Trump is disrupting an order that needs disruption and markets are celebrating.

Are we past the peak moment of tariff uncertainty for financial markets, consumers, and other countries?

Annmarie Hordern

Kevin Hassett

Tariffs surprised mainstream economists. Grad school models turned out not true. If we have long-term trade deficits, trading partners bear tariffs by cutting prices to maintain US market share. Trump's agenda positively disruptive for Europe by making them increase defense spending and reducing zombie companies.

Competition from tariff uncertainty may have been a shot in the arm for European economy.

Are you concerned about unintended consequences pushing allies closer to China? Spain and Mark Carney examples.

Annmarie Hordern

Kevin Hassett

No, that's not happening. Trump's plan is working for US and global economy. People look at wallets - in US they see 5% growth, booming markets, booming wages. Those attacking Trump speak for liberal policies, not their countries.

Are you concerned about tightening financial conditions and yields rising?

Annmarie Hordern

Kevin Hassett

There's little wiggling but bond yield depends on US deficit, which we reduced by about 600 billion year over year, expecting more next year. Done with real stuff like cutting government employment by 270,000 workers. Bond markets will feel secure investing in US debt.

Secretary Bessett is best salesman. He wants 10-year at 3% but we're not there yet.

What do you make of more assertive Fed Chair Powell? Concerns about Fed independence and tighter conditions.

Annmarie Hordern

Kevin Hassett

Greenspan kept Fed out of politics. Current Fed members want opinion about everything daily, not just monetary policy. Example: Austin Goolsbee criticized Trump's tariff agenda right after he took office. This goes into politically dangerous place for Fed.

Was it appropriate Powell went to Supreme Court? No.

Your name is in mix for Fed process. President making announcement soon. Senator Tillis says process shouldn't proceed until Powell subpoena drama resolved.

Annmarie Hordern

Kevin Hassett

President wants me to stay. White House hasn't finalized. Thrilled with many good candidates. Whether I stay relates to great White House team running on all cylinders.

Kevin Hassett

Fed overruns are humongous - right to investigate where they came from and if someone profited. Not happy with Fed transparency. Subpoena might be required for them to own up. Expect things to move quickly.

President's nominee will have no trouble in end.

Midterm elections North Star. Will we see credit card cap, housing market policies, defense sector buyback bans?

Annmarie Hordern

Kevin Hassett

Big housing policy announcement coming soon. Economic agenda ambitious for year ahead. Typical down payment doubled to $34,000 due to Biden's inflation. People buying houses at 40 unacceptable. Policies to make housing affordable.

Already this year mortgage rates have come down.

Davos is place for global elite. What message should president make to Americans about why he should be here?

Annmarie Hordern

Kevin Hassett

President believes he can help world understand effectiveness of his policies. People here advocated awful policies while increasing in sanctimony as they declined in wisdom. Here to set record straight with hard data.

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