Letter to Chairman Jerome H. Powell of the Federal Reserve – April 7, 2020
Jerome H. Powell
Board of Governors
of the Federal Reserve
20th Street and Constitution Avenue, NW
Washington, DC 20551
Dear Chairman Powell:
I want you to know the dismay of many consumer advocates at your extreme zero-interest rate policy. Interest rates were already low in the home mortgage area and not likely to change significantly in that industry. On the other hand, you have stripped hundreds of billions of dollars of interest rate income from over 150 million savers in our country. Much of that income would have created more consumer demand in our economy. Interest rates on trillions of dollars in money-market’s and saver’s accounts and banks etc. are heading toward near zero because of the Fed’s actions.
I think, you and other Federal Reserve Board governors need to explain publicly to the American people, why you do not take into account the income needs of these savers in your monetary balancing decisions. You also need to explain that millions of borrowers do not receive much protection from your low-interest rate policies when it comes to unpaid credit card balances, payday loan and rent-to-own rackets, and the federal government charging undergraduate student loan borrowers 4.53% for the 2019-2020 school year. These and other very high interest rates are not regulated to any reasonable degree either at the state or federal level.
I hope you’ve read William Greider’s book Secrets of the Temple: How the Federal Reserve Runs the Country. The Fed needs to be far less secretive and far less autocratic. The widespread impression that you have buckled under unprecedented pressure and haranguing from Donald Trump is fortified by my conversations with retired former Fed and Treasury officials. They are horrified that you have not resisted this crude political bludgeoning. This ongoing mockery of the Fed’s alleged independence will not escape the historians.
I look forward to your considered response.
P.O. Box 19312
Washington, DC 20005
CC: Interested members of Congress, leading media reporters, and consumer advocates.