Would A Trump Takeover Of The Fed Be A Good Thing?
Posted October 9, 2025
On the Wealth Formula podcast, Richard Duncan discusses the most important macro shift in decades: a White House push to re-industrialize the US, devalue the dollar, and potentially bring the Federal Reserve under direct control.
Highlights from the conversation with Buck Joffrey:
- Tariffs → Leverage → Dollar Devaluation: A three-step plan outlined by Stephen Miran (now a Fed governor) aims to (1) impose high tariffs, (2) threaten to withdraw military protection if allies retaliate, and (3) pressure partners into a new “Mar-a-Lago Accord”–style dollar devaluation to narrow the trade deficit.
- From Globalization to Re-Industrialization: For 40+ years, the US trade deficit fueled globalization, disinflation, low rates, and booming asset prices worldwide. Eliminating the deficit would reverse those flows—reducing foreign capital into Treasuries and potentially pushing yields higher unless offset by policy.
- Fed Control & QE as a Backstop: If the administration secures control over monetary policy, it could cut short-rates sharply while using renewed QE to cap long yields—fueling a powerful asset boom even as inflation pressures rise.
- State-Directed Capitalism & a US Sovereign Wealth Fund: Financing a federal sovereign wealth fund with central-bank money could supercharge investment in AI, energy capacity (including nuclear/fusion), robotics, biotech, and advanced manufacturing—accelerating productivity but also reshaping market dynamics.
- Winners, Risks, and Inequality: Asset owners could benefit most from a policy mix that weakens the dollar and lifts asset prices. But the longer-run risks include bigger booms and bigger busts, heightened income/wealth inequality, and institutional strain if central-bank independence erodes.
- Creditism Still Rules: Credit growth—not traditional saving—remains the core driver of modern economic expansion. US household net worth has exploded in recent years, pushing the wealth-to-income ratio far above historical norms—another sign of systemic imbalance that policy choices could magnify.
Why this matters now
We’re entering a period where policy, geopolitics, and technology—not just the usual business cycle—will drive markets. Understanding how tariffs, dollar strategy, Fed governance, QE, and AI-energy buildouts collide is essential for anticipating inflation, interest rates, currency moves, and asset prices.
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