"The Justice Department recently served grand-jury subpoenas on the Board of Governors, zeroing in on testimony Charman Jerome Powell gave about the cost of renovating the Fed's headquarters. Powell quickly released a video message where he said that the probe is not due to his testimony, but instead because the Fed hasn't yielded to the president's pressure to lower interest rates."
"Whatever the case may be, it isn't a secret that President Donald Trump wants interest rates much lower than they are today. Powell is expected to be replaced by a Trump appointee this year. If interest rates are indeed set according to Trump's wishes, we can use his earlier statements to arrive at a ballpark. He has said earlier that he would like to see interest rates at 1% or "maybe" lower than that."
The Justice Department served grand-jury subpoenas on the Board of Governors focusing on testimony Jerome Powell gave about the cost of renovating the Fed's headquarters. Powell released a video message saying the probe is not due to his testimony but because the Fed has resisted presidential pressure to lower interest rates. President Donald Trump favors much lower rates and Powell is expected to be replaced by a Trump appointee this year. If rates are cut sharply, dividend and income-focused ETFs such as TMF, PFF, and SCHP would likely benefit. TMF offers 3x exposure to long-term Treasuries and has a 3.97% dividend yield.
Read at 24/7 Wall St.
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