Run It Hot: Trump, The Fed, & The Coming Currency Debasement

The Trump administration appears poised to aggressively pursue monetary easing to inflate the stock market before the 2026 midterm elections. A key factor is Trump's expected influence over the Federal Reserve once Jerome Powell's term as Chair concludes in May 2026. Trump could appoint a loyalist to this position, leading to unprecedented money printing. Furthermore, the concept of a "third mandate" for the Fed, proposed by Stephen Miran, would involve moderating long-term interest rates. This effectively means the Fed would directly finance government spending by creating new money to purchase long-term debt, signaling a loss of central bank independence. This action would artificially suppress interest rates, allowing for continued high government borrowing, but at the cost of debasing the US dollar. Historically, the Fed's independence was a crucial myth to maintain confidence in the fiat currency. This illusion is now rapidly disintegrating as monetary policy becomes overtly political. Evidence of this shift is seen in the Fed's recent decision to cut interest rates despite inflation exceeding its 2% target. Additionally, the Fed has halted the shrinking of its balance sheet and is now expanding it by purchasing Treasuries, which is essentially money printing. This marks a new cycle of monetary easing, occurring even though the balance sheet remains significantly larger than pre-Covid levels. This pattern of balance sheet expansion and contraction, with each cycle ending at a higher level, has led to a permanent debasement of the currency. The current situation suggests the beginning of an especially aggressive balance sheet expansion cycle. All these indicators point towards a continued stock market rally in 2026, accompanied by accelerating currency debasement. This trend has profound personal implications, eroding savings and purchasing power. The author offers a free PDF report to help individuals prepare for these impending economic challenges.