Donald Trump Should Rein In Consumer Spending - Increase The Federal Funds Rate and Discount Rate!

This is my public message to Donald Trump on Truth Social.

When it comes to the Federal Funds Rate and the Discount Rate set by the Federal Reserve, I strongly disagree with the direction Donald Trump is pushing.

I do understand his frustrations with Jerome Powell, and I agree that the Federal Reserve should ultimately be accountable to the broader framework of the U.S. government—meaning, it shouldn't operate completely independently of the three constitutional branches. On that point, we see eye to eye. However, Trump’s use of this authority to pressure the Fed into lowering interest rates is where I take issue.

If we’re serious about tackling inflation, we need to aim for an inflation target closer to 1% and reduce excessive consumer spending. While this might seem counterintuitive to some, raising interest rates can actually benefit American citizens by encouraging savings. For over a decade, traditional savings accounts have yielded a dismal 0.01% to 0.1%—a far cry from what they should offer. Yes, there are better options out there—like discount brokerage accounts, CDs, and other financial tools—but realistically, many lower-income Americans don’t have the time or resources to explore those alternatives.

Earning just 0.01% interest in a basic savings account is, frankly, a slap in the face to hardworking Americans. We do have a spending problem in this country. While increased consumer spending can boost GDP and paint a rosy picture of economic activity, it doesn’t always reflect financial stability for the average American. A stronger dollar and better incentives to save would serve our population much better in the long term.

It’s time to stop glorifying overspending. We need to foster a culture of financial responsibility and promote the habit of saving—something that truly empowers individuals and strengthens our economy from the ground up.

Follow me on Truth Social: LuchiCholito