Economist Justin Wolfers on Trump's threat to Powell: “This is the stuff of tinpot dictators. This is the stuff that tends to precede a hyperinflation.”
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From the January 12, 2026, edition of MS NOW's Ana Cabrera Reports
ANA CABRERA (ANCHOR): Justin, investors, executives, economists all like stability, right? This unprecedented clash between Trump and Powell would seem to totally undermine the idea of stability. How's the money class going to respond to this?
JUSTIN WOLFERS (UNIVERSITY OF MICHIGAN ECONOMIST): Very, very, very badly. So, this is unprecedented. And let's cut through the legal jargon here. This was the president threatening the Fed chair with jail. He was doing it quietly. He didn't announce it, it's — the Fed chair came out and brought it out in public. Now, is this the first time a Fed chair has been threatened with jail for upsetting the president? In U.S. history, it's absolutely the first time. In global history, absolutely not. We've seen these tactics before in Argentina, Russia, Turkey, Venezuela, and Zimbabwe. This is the stuff of tinpot dictators. This is the stuff that tends to precede a hyperinflation. This is the sort of story that never ends well.