alt Hacker NewsGold reverted to the price it was wait for it five days ago. What actually happened was that Trump was forced/pressured to pick Warsh because prices were spiking in anticipation of how Trump's preferred pick would impact global finance.
But anyone who thinks Trump won't get his way and control the Fed to create hyper-inflation is living in a fantasy world that I wish were our actual reality.
We live in a world where Trump launched a criminal investigation against Powell. This is not someone who somehow learned his lesson in the last five days.
The irony is that if Trump understood how markets perceive threats to Fed independence, he'd try to influence rates behind closed doors and not make a public spectacle of his attempt to undermine Fed independence!
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I have no idea about his credentials or suitability for the job, but Warsh is the son in law of Trump's buddy Ronald Lauder. I get the feeling he's not picking people he doesn't think he can control.
"Fed independence" has always been kind of a ruse. The theory is Congress would want to print money so they can spend it, so you need someone whose job it is to not do that. But then Congress just borrows the money instead, which forces the Fed to respond to keep interest rates where they want them, with the result that they still end up de facto printing trillions of dollars at the behest of Congress.
To some extent the "independence" is even worse, because the Fed has limited ways it can respond to what Congress does and "long-term cause individual debt to get completely out of hand" is one of their primary effects, which is pretty bad and plausibly worse than inflation having been slightly higher over the same period.
Fed independence is damaged but it was never as independent as it should have been.
No one since Volcker has been a real hawk. It hasn't led to hyperinflation, just a continual debasement that has served many purposes.