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Hindustan Times
a day ago
- Business
- Hindustan Times
Who Is Stephen Miran, Donald Trump's Fed Nominee?
President Trump likes to stir things up, and he's done it again with his choice of Stephen Miran to fill an open seat on the Federal Reserve Board of Governors. We can't recall when a President nominated to the Fed someone whose abiding policy conviction is to weaken the U.S. dollar. Mr. Miran has been chairman of the White House Council of Economic Advisers in Mr. Trump's second term. He's an ardent promoter of the President's economic policies, especially tariffs. For Mr. Miran, this is a matter of conviction. Before his White House days he offered a detailed case for rewriting the rules of the global trade and financial system. He summed up his central argument in a widely cited November 2024 essay: 'From a trade perspective, the dollar is persistently overvalued, in large part because dollar assets function as the world's reserve currency.' Foreign central banks hold huge dollar reserves and most of the world's goods are traded in dollars. He says this global demand for dollars results in an overvalued greenback that leads to trade imbalances and harms Americans. His solution? Manage a decline in the dollar's value over time by reducing the global demand for the U.S. currency, or at least mitigate the effects of its overvaluation. Tariffs do the latter in his view by forcing foreigners to pay for the fact that their currencies are undervalued and boost their exports to the U.S. But his ambition goes beyond tariffs. In that 2024 essay he laid out other policy options for negotiating a weaker dollar and diminishing its reserve-currency status. One idea is to tax foreigners who hold U.S. Treasury debt as an incentive to hold less of it. This would amount to a de facto default on current debt. More ambitiously, Mr. Miran floats a 'Mar-a-Lago Accord' in which leading nations would negotiate a new global financial system to rebalance currency values. This echoes the Plaza and Louvre accords of the 1980s that coordinated monetary policies to arrest the surging dollar amid the rush of capital and goods into the U.S. during the Reagan economic boom. Mr. Miran says his essay wasn't 'policy advocacy,' but when you land something like this after an election it's intended to get the attention of policy makers. It did, and Mr. Miran got the White House job. One question is whether Mr. Miran has talked to Mr. Trump about all this. The President likes a weak dollar for protectionist purposes, but he also likes the dollar's reserve-currency status. That status lets the U.S. borrow more cheaply to fund its deficits and gives him leverage to impose sanctions to pursue U.S. security interests. China and Russia in particular want to break the dollar's hold on global trade so U.S. sanctions won't matter. Mr. Trump has gone out of his way to impose higher tariffs on countries that are trying to diminish the dollar's global status—see Brazil. Others have written on these pages about the burden of being a reserve-currency country, notably Lewis Lehrman and John Mueller. But their answer is a global monetary reform that links the dollar to gold. Their goal is a stable dollar, not a weak one. This is a debate worth having, as improbable as such a reform is. But Mr. Miran gives no indication he has given any thought to such a global monetary reform. His preoccupation is devaluing the dollar to reduce the flow of capital and imported goods to the U.S. None of this is at stake any time soon, since Mr. Miran would for now only fill the remaining term of Adriana Kugler, who resigned Friday and whose term ends in January. Mr. Miran would be only a single vote on the Federal Open Market Committee. But Mr. Trump is also looking to replace Fed Chair Jerome Powell, and as Chair Mr. Miran would have a global platform and influence. Senators can do the country a favor by exploring Mr. Miran's views and whether a dollar devaluationist at the Fed is in the U.S. national interest.
Mint
a day ago
- Business
- Mint
Who is Stephen Miran, Donald Trump's Fed nominee?
US President Donald Trump likes to stir things up, and he's done it again with his choice of Stephen Miran to fill an open seat on the Federal Reserve Board of Governors. We can't recall when a President nominated to the Fed someone whose abiding policy conviction is to weaken the U.S. dollar. Mr. Miran has been chairman of the White House Council of Economic Advisers in Mr. Trump's second term. He's an ardent promoter of the President's economic policies, especially tariffs. For Mr. Miran, this is a matter of conviction. Before his White House days he offered a detailed case for rewriting the rules of the global trade and financial system. He summed up his central argument in a widely cited November 2024 essay: 'From a trade perspective, the dollar is persistently overvalued, in large part because dollar assets function as the world's reserve currency." Foreign central banks hold huge dollar reserves and most of the world's goods are traded in dollars. He says this global demand for dollars results in an overvalued greenback that leads to trade imbalances and harms Americans. His solution? Manage a decline in the dollar's value over time by reducing the global demand for the U.S. currency, or at least mitigate the effects of its overvaluation. Tariffs do the latter in his view by forcing foreigners to pay for the fact that their currencies are undervalued and boost their exports to the U.S. But his ambition goes beyond tariffs. In that 2024 essay he laid out other policy options for negotiating a weaker dollar and diminishing its reserve-currency status. One idea is to tax foreigners who hold U.S. Treasury debt as an incentive to hold less of it. This would amount to a de facto default on current debt. More ambitiously, Mr. Miran floats a 'Mar-a-Lago Accord" in which leading nations would negotiate a new global financial system to rebalance currency values. This echoes the Plaza and Louvre accords of the 1980s that coordinated monetary policies to arrest the surging dollar amid the rush of capital and goods into the U.S. during the Reagan economic boom. Mr. Miran says his essay wasn't 'policy advocacy," but when you land something like this after an election it's intended to get the attention of policy makers. It did, and Mr. Miran got the White House job. One question is whether Mr. Miran has talked to Mr. Trump about all this. The President likes a weak dollar for protectionist purposes, but he also likes the dollar's reserve-currency status. That status lets the U.S. borrow more cheaply to fund its deficits and gives him leverage to impose sanctions to pursue U.S. security interests. China and Russia in particular want to break the dollar's hold on global trade so U.S. sanctions won't matter. Mr. Trump has gone out of his way to impose higher tariffs on countries that are trying to diminish the dollar's global status—see Brazil. Others have written on these pages about the burden of being a reserve-currency country, notably Lewis Lehrman and John Mueller. But their answer is a global monetary reform that links the dollar to gold. Their goal is a stable dollar, not a weak one. This is a debate worth having, as improbable as such a reform is. But Mr. Miran gives no indication he has given any thought to such a global monetary reform. His preoccupation is devaluing the dollar to reduce the flow of capital and imported goods to the U.S. None of this is at stake any time soon, since Mr. Miran would for now only fill the remaining term of Adriana Kugler, who resigned Friday and whose term ends in January. Mr. Miran would be only a single vote on the Federal Open Market Committee. But Mr. Trump is also looking to replace Fed Chair Jerome Powell, and as Chair Mr. Miran would have a global platform and influence. Senators can do the country a favor by exploring Mr. Miran's views and whether a dollar devaluationist at the Fed is in the U.S. national interest.
Mint
a day ago
- Business
- Mint
Trump's Fed pick is a dove. How Miran could move the market.
Wall Street shrugged at President Donald Trump's plan to nominate his economic adviser, Stephen Miran, to the Federal Reserve. The immediate market reaction to Thursday's announcement was muted, but investors now must factor in another White House-aligned voice pushing for rate cuts and a lighter regulatory touch inside the central bank. Miran, who is chair of the White House Council of Economic Advisers, is slated to complete the term of Fed Gov. Adriana Kugler, whose surprise resignation became effective on Friday. She joined the Board of Governors in September 2023; her term expires at the end of January. The Senate probably won't vote on the Miran nomination before the Fed's September policy meeting. So, the real significance for markets lies in what comes after September. 'This could be the first domino in a sequence leading to looser policy, inflation above target, and a weaker dollar," wrote Daniel Altman, founder of High Yield Economics, in a note. Miran has repeatedly called for a weaker dollar. In a 41-page essay on international trade, published by Hudson Bay Capital last November, Miran maintains that 'the root of the economic imbalances lies in persistent dollar overvaluation that prevents the balancing of international trade…." A former senior strategist at Hudson, Miran goes on to lay out what he describes as tools for reshaping global trade and the world's financial systems. A key tool, he wrote, is devaluation of the greenback, done by the Fed's ability to create money supply. 'Flooding the market with dollars, thus lowering short-term interest rates and causing higher inflation, would be one way to achieve Miran's goal," said Altman, 'and only the Federal Reserve has the tools to do it." Miran was a hawk who turned into a dove, now arguing that tariffs don't lead to inflation and who has repeatedly criticized Fed Chair Jerome Powell for his reluctance to ease monetary policy. In the past, Miran proposed nationalizing the regional Federal Reserve Banks and making all board members at-will employees who the president can fire at any time. In the near term, Wall Street analysts don't see a major policy pivot at the Fed. 'Miran's appointment will do little to change policy on the margin in the near-term but it does add another dovish voice to the fray," wrote economists at 22V Research. Two Fed governors, Christopher Waller and Michelle Bowman, dissented during the central bank's July policy meeting, advocating for a quarter-point rate cut. There may be, however, 'an element of testing Waller's, and to a lesser extent Bowman's, dovish commitment if Miran is willing to always go one step beyond them in pushing for lower rates," the 22V economists wrote. Miran 'could speak a lot publicly, supporting the president and perhaps openly undermining Powell, but it will be hard for him to move the policy needle," said analysts at Capital Alpha Partners. 'The Fed isn't set up in a way that provides one governor that much influence." The timing of Miran's confirmation is also a market variable. 'Getting Miran approved by the Senate after it gets back from recess on September 5 but before the next FOMC meeting starts on September 16 would be a Herculean task," wrote Michael Feroli at JPMorgan. But, 'In the off chance Miran is governor by the time of the next meeting, that could imply three dissents. That's a lot of dissents." Assuming that Miran is approved by the Senate, Feroli expects the Fed to cut rates by a quarter point at each of its next three meetings. Miran's nomination is part of a larger push by the White House to reshape the role of the Fed. Personnel is policy—as the Reagan-era line goes—and analysts think that may be the best way to think about Trump's approach. Luis Alvarado, a global fixed income strategist at Wells Fargo Investment Institute, called Miran's nomination a 'strategic move by the Trump administration to advance its economic agenda while also maintaining flexibility for future appointments." The upshot is that investors are now staring at a new vote for cheaper money and a friendlier stance on regulation, factors that could influence the size and pace of cuts, the path of the dollar, and how banks are supervised. Write to Nicole Goodkind at
Politico
4 days ago
- Business
- Politico
Canada courts Mexico as Trump escalates tariff fight
'It's no secret that Canada is an energy powerhouse and that we have the ability to supply energy to willing countries,' Foreign Affairs Minister Anita Anand told POLITICO from Mexico City. Canada's Mexican charm offensive underscored the imperative for Carney's government to shore up relations with Mexico ahead of the upcoming review of the United States-Mexico-Canada Agreement. Carney insists the pact provides tariff-free trade for 85 percent of Canada's exports to the U.S. despite the 35 percent tariff imposed last Friday. There are no guarantees Trump will continue to honor the USMCA as tensions rise. While Anand and Finance Minister François-Philippe Champagne were making the rounds in Mexico, a top White House official accused Ottawa of cozying up to China. Canada and China are the only two among roughly 90 countries to impose retaliatory tariffs on the U.S. Stephen Miran, chair of the White House Council of Economic Advisers, told CNBC that 'things are looking very promising' for finalizing a trade deal with Mexico after Trump gave the country a 90-day extension. 'Canada needs to get its act together,' Miran said. 'I think Canada has decided it would rather be similar to China and retaliate against the United States.' Anand dismissed Miran's criticism. 'Negotiations between the United States and any other country are not comparable to Canada's negotiations with the United States,' Anand said. 'You can't take a … playbook from one country and simply apply it across the board to other countries.' She said Canada-U.S. relations in security and defense remain strong, but she conceded: 'In every relationship, there are hills and valleys.' Canada Foreign Affairs Minister Anita Anand addresses the United Nations General Assembly on July 28. | Richard Drew)/AP In Mexico City this week, Anand and Champagne devoted two days to revitalizing two-way collaboration on investment and energy. Anand said their 75-minute meeting with Sheinbaum on Tuesday opened doors to further talks with several of her senior Cabinet members and additional meetings with top executives from Mexican firms and Canadian companies in Mexico. Spurring investment in Mexican energy infrastructure projects, including pipelines and ports, was a major topic, Anand told POLITICO. That included finding investment opportunities for Canada's 'Maple 8' pension fund group of companies, which has more than C$2 trillion in assets.
The Hill
5 days ago
- Business
- The Hill
Trump to nominate top White House economist to Fed board
President Trump announced Thursday he would nominate Stephen Miran, chair of the White House Council of Economic Advisers (CEA), to serve as a 'temporary' member of the Federal Reserve Board of Governors. In a post on Truth Social, Trump said he would nominate Miran to a soon-to-be vacant spot on the Fed board while the president searches for a long-term replacement. 'He has been with me from the beginning of my Second Term, and his expertise in the World of Economics is unparalleled — He will do an outstanding job. Congratulations Stephen!,' Trump wrote. Miran served as an economic adviser to former Treasury Secretary Steven Mnuchin during Trump's first term. He was confirmed along party lines to lead the CEA for Trump's second term, making him the top White House economist at a critical time for the president's agenda. Miran received his PhD in economics from Harvard University and wrote a paper in November focused on the relationships between tariffs and the value of the U.S. dollar that caught steam among Trump's top advisers. Once confirmed by the GOP-controlled Senate, Miran would serve the remainder of a term occupied by Fed Governor Adriana Kugler, who will depart the central bank Friday and return to academia. Kugler's term was set to expire Jan. 31, 2025. Miran's confirmation to the Fed board could affect the timing of Trump's eventual replacement of Fed Chair Jerome Powell, whose term leading the central bank expires in February.
