On August 14, 2025, former President Donald Trump took center stage at the Kennedy Center for the Performing Arts and delivered a message that sent ripples through the financial and political worlds: he intends to name a new Federal Reserve Chair “a little bit early.” While he withheld a precise timeline, Trump made it clear that he has “three or four names—all great” under consideration. This announcement, coupled with his ongoing criticism of current Fed Chair Jerome Powell, has reignited debate over the future of U.S. monetary policy and the direction of the American economy.
Trump’s remarks come at a time when mortgage rates have reached their lowest point of 2025, as reported by HousingWire. In a recent episode of the HousingWire Daily podcast, Editor in Chief Sarah Wheeler and Lead Analyst Logan Mohtashami discussed the implications of these rate drops and Trump’s latest maneuvers to undermine Powell’s authority. The podcast, known for its in-depth analysis of the housing and real estate markets, provided timely context for Trump’s statements and the broader economic landscape.
At the Kennedy Center event, Trump did not hold back in his criticism of Powell, lambasting the Fed Chair for failing to cut interest rates. “We should be down at 1% because we’re the leader of the world... We were always the lowest interest rate until like a certain time ago, a decade, a couple,” Trump declared, according to Business Insider on MSN. He went on to blame Powell for high mortgage rates, quipping, “People aren’t able to get good mortgages because of Jerome ‘Too Late’ Powell.”
Trump’s grievances weren’t limited to monetary policy. He also took aim at Powell’s management of a multi-billion-dollar renovation project at the Federal Reserve’s headquarters, particularly the construction of a new basement. “He took a building that could have been painted and fixed... what they did to this building,” Trump said, suggesting that the project was “grossly incompetent” and unnecessarily costly. “They did a job that shouldn’t have been done... I think it’s just grossly incompetent, but not quite as incompetent as his decision not to do interest rates, take down interest rates,” he added, making a pointed analogy: “Just like they shouldn’t have taken down a ceiling, they should take down interest rates.”
Trump also offered a stark assessment of the financial burden imposed by current interest rates, claiming that each percentage point of the federal funds rate costs the U.S. government $360 billion annually in interest payments on the national debt. “I believe we should be 3 or 4 points lower,” he insisted, underscoring his belief that lower rates are not just desirable but necessary for the nation’s economic health.
While Trump’s remarks dominated headlines, another voice has been sounding the alarm about America’s economic trajectory—David Rosenberg, president of Rosenberg Research. In a report released on August 13, 2025, Rosenberg warned that the U.S. may be “staring down the barrel of a deflationary shock.” According to Business Insider, Rosenberg believes that a combination of tariffs, restrictive immigration policies, and an aging population could push the U.S. into a period of falling prices—a scenario that, while it might sound appealing to consumers, often signals deeper economic trouble.
“We are now staring down the barrel of a deflationary shock, and it amazes me how all the bond bears, inflation-phobes, and Fed policy hawks are missing this secular shift as they continue to play by the old rules,” Rosenberg wrote. He outlined three primary factors contributing to the risk of deflation: first, tariffs, which while typically inflationary, can also suppress consumer spending and thus reduce prices; second, declining immigration, which reduces the pool of peak-spending households; and third, a rapidly aging population, which tends to save more and spend less.
Rosenberg pointed to recent data to support his warning. Inflation rose to 2.7% in July 2025, but retail sales have shown signs of weakness, growing just 0.6% in June after a 0.9% contraction in May. July’s retail sales were expected to grow only 0.5%. “GDP is, after all, only about spending,” Rosenberg noted, emphasizing that consumer spending accounts for about two-thirds of U.S. economic growth.
Immigration trends are also shifting. Rosenberg highlighted a 20.5% drop in new entrance visas to the U.S. in May 2025, a development that could further suppress consumer demand. Most immigrants, he observed, are between the ages of 35 and 54—the prime years for household spending. “Every young immigrant household not allowed into the U.S. accelerates the aging consumption cliff that lies around the bend,” Rosenberg wrote, warning that the U.S. is “following the footsteps” of countries like Japan and China, which have struggled with deflation and sluggish growth for years.
Demographic changes compound these challenges. The U.S. Census projects that the number of Americans aged 65 and older will soar to 82 million by 2050, a 47% increase from 2022 levels. As people age, their consumption patterns shift dramatically. Rosenberg’s analysis found that the likelihood of consuming drops from 0.94 at age 35 to around 0.67 at age 65. “The fact that this is happening in such a highly leveraged economy is only going to exacerbate the deflationary trendline in the not-too-distant future,” he concluded.
Trump’s push to replace Powell and slash interest rates reflects a broader debate about how best to steer the U.S. economy through these uncertain waters. Supporters of aggressive rate cuts argue that lower borrowing costs are essential to spur investment, ease the burden of government debt, and make homeownership more affordable. Critics, however, caution that precipitous cuts could undermine the Fed’s independence and leave policymakers with fewer tools to combat future downturns.
The political calculus is equally complex. Trump’s public attacks on Powell and the Fed echo his earlier presidency, when he frequently clashed with the central bank over its rate decisions. By promising to appoint a new chair “a little bit early,” Trump is signaling to his base—and to financial markets—that he intends to take a hands-on approach to monetary policy if he returns to office. Whether this approach will yield the desired results, or simply inject more volatility into an already jittery economy, remains to be seen.
As the debate over interest rates, inflation, and economic growth continues, Americans are left to navigate a landscape marked by uncertainty and competing visions for the future. With mortgage rates at their lowest in 2025 and the specter of deflation looming, the stakes have rarely been higher. The coming months will reveal whether Trump’s gambit pays off—or whether the U.S. economy is, as Rosenberg warns, heading down a more treacherous path.
