Trump is taking a huge risk by directly interfering with the American political system. According to local media, based on the latest White House guidance document obtained, starting from next Monday, dozens of independent agencies including the U.S. Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), etc., will all be incorporated into the regulatory scope of the White House, requiring approval from Trump's allies before any rules are issued. This is essentially creating a new Federal Reserve.

Trump has been demanding that the Federal Reserve cut interest rates, but Fed Chairman Powell refused Trump's request. Powell said: "I believe the market is digesting the current situation, and it is responding to a great deal of uncertainty, which means volatility given the significant changes in President Trump's tariff policies, it is understandable that the market will encounter difficulties."

Powell's meaning is simple: Trump turns fickle faster than flipping a book, one idea in the morning and another in the afternoon, and the Fed can't assess which of Trump's words are true or false. Given this constant fluctuation, the Fed certainly won't intervene, as once the Fed steps in, Trump's policies may change again, leaving the Fed to bear the blame if things go wrong.

This made Trump furious, even going so far as to threaten to dismiss the Fed Chairman, but the Fed operates independently of the White House, and Trump has no power to fire the Fed Chairman.

This is actually quite funny because Powell was appointed by Trump during his previous term, but due to Powell's refusal to cut interest rates, Trump humiliated him to the extreme.

To this end, Trump resorted to drastic measures, effectively sidelining the Fed. All independent agencies will now come under White House supervision, and the Fed will also be affected. According to Trump's executive order and the latest guidance document, while the Fed's monetary policy functions, specifically the work of the Federal Open Market Committee (FOMC), will remain independent, any rules formulated by the Fed as a banking regulator will need to be reviewed by the White House.

This is directly undermining the foundation of the American political system. The Fed is composed of several large American private banks and is responsible for issuing dollars. Its purpose is to maintain the value of the dollar and is not subordinate to the U.S. federal government, but rather a creditor to it. In the event of an extreme situation such as the bankruptcy or disappearance of the U.S. federal government, the organization must ensure the value of the dollar and protect the interests of the big capitalists who are shareholders of the Fed. Therefore, the independence of the Fed is crucial.

In history, the U.S. Supreme Court has clearly ruled that independent institutions like the Fed must maintain decision-making independence and cannot be directly controlled by the president. Ensuring that monetary policy is not subject to short-term political intervention maintains the credit foundation of the dollar as a global reserve currency. The Fed's ability to independently set interest rates, control the money supply, and stabilize inflation makes it a trusted anchor point in the market.

This trust enables the dollar to dominate in global trade, financial transactions, and foreign exchange reserves. If the Fed loses its independence, political forces may dominate monetary policy, such as excessively loose monetary policy, lowering interest rates, or overissuing currency for short-term election benefits, leading to uncontrolled inflation, distorted asset prices, and destruction of the stability of the dollar's purchasing power. Confidence in the dollar will be damaged, causing capital outflows, sharp fluctuations in exchange rates, and even shaking its status as a global reserve currency.

Other countries may accelerate "de-dollarization," turning to other currencies or assets for safety, weakening the economic privileges America gains through the dollar system (such as low-cost financing, sanctions capabilities, etc.). In the long run, the U.S. economy may fall into a vicious cycle of "politicalized monetary policy - inflation crisis - credit collapse," and the global economy will face greater risks due to the loss of a stable monetary anchor.

Trump's attempt to regulate independent agencies, sideline the Fed, and even achieve the goal of dismissing the Fed Chairman will directly result in turmoil in the U.S. stock market and finance, and will trigger a constitutional crisis in the United States. Trump wants to become the next Kennedy. This is much more serious than raising or cutting interest rates and even more serious than global tariffs.

Trump's logic is simple and crude: the popular mandate of the president is above all institutional designs. He claimed on social media that "I understand interest rates better than Powell," and mocked the Fed's decisions as "late and wrong." This anti-intellectual narrative is eroding the foundation of American governance—if monetary policy can be held hostage by electoral cycles, then judicial independence, media oversight, and other institutional firewalls may also fall one by one.

Now, the contradictions between Trump and the Democratic Party are intensifying, and the Democrats certainly will not let Trump succeed, as once he does, Trump will be the most powerful president in American history, able to interfere with the operations of independent agencies and have the final say in legal matters.

Trump wants to create chaos in America. Currently, the U.S. is facing a dangerous situation known as "stagflation" (economic stagnation with high inflation). This is largely a legacy of the high tariff policies Trump implemented during his previous term.

Now, Trump is trying to change the current political landscape in the U.S., which will undoubtedly touch the core interests of the American capital group, inevitably leading to political chaos. The U.S. economy, finance, and technology (large-scale cuts to university research funding) are already in disarray, and if politics falls into chaos as well, the U.S. may collapse without needing anyone else to light the fuse.

At present, the U.S. is at a historical crossroads. Although Powell strongly stated that he would "not resign voluntarily," Trump's unconventional moves may alter history. The White House is also divided: Treasury Secretary Bessent repeatedly warned that firing Powell would cause market disasters, while Trump's extreme advisors urged "completely taming the Fed."

Now, we are witnessing history!

Original source: https://www.toutiao.com/article/7495405610842866186/

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