President Donald Trump’s efforts to reduce US deficits may be taking an unconventional approach. His campaign against Federal Reserve Chair Jerome Powell could be linked to proposals for regulating digital stablecoins and improving Treasury’s debt-management practices.
The proposal to regulate digital stablecoins, which are cryptocurrencies pegged to the value of a traditional asset, aims to increase transparency and reduce the risk associated with these financial instruments. By doing so, it could potentially help stabilize the US economy and improve the overall fiscal health of the country.
Furthermore, Treasury’s debt-management practices, including the use of T-Bills, have been identified as key tools in reducing deficits. T-Bill interest rates have decreased over the past few years, contributing to lower borrowing costs for the government. This could help reduce the nation’s debt burden and make it more manageable.
In essence, President Trump’s push against Jerome Powell and his efforts to regulate digital stablecoins may be part of a broader strategy to cut US deficits using unconventional tools that have been overlooked or underappreciated in the past.
Source: https://www.barrons.com/articles/trump-wants-to-cut-deficits-powell-bashing-stablecoins-and-t-bills-could-help-7afae5b5