The Senate Banking Committee hearing, held today, will decide the fate of Trump’s latest nominees to the Federal Reserve’s Board of Governors. Judy Shelton, known for her unorthodox views, including hints of support for the crypto asset industry, is amongst them.
Shelton is a proponent of a system like the gold standard. However, she also stresses the need for any such common anchor to improve on the shiny yellow metal so it can better serve a digital economy.
Echoing the Crypto Industry: Shelton Doesn’t Think the Fed Should Set Monetary Policy
The two Trump nominees will face a Senate grilling today ahead of a vote to fill the remaining seats on the central bank’s Board of Governors. One of them is Judy Shelton, a proponent of a return to something like the gold standard.
Shelton is known for being a fan of hard monetary policy and not so impressed by central banks. Without explicitly mentioning crypto assets, she has espoused views that seem to advocate for a common, global digital unit of account.
In a clip featured as part of a video posted by CNN earlier today, Shelton says the following:
“We need another Breton Woods or at least we need to be thinking in terms of a neutral reference point, a global unit of account, something like a gold standard updated to reflect a digital world and fast-moving financial flows.”
Could be the first ever true bitcoin advocate at the Federal Reserve. Important story to watch. https://t.co/QBOcTdfxIc
— Nik Bhatia (@timevalueofbtc) February 13, 2020
Of course, Trump has previously said that he is opposed to any alternative to the US dollar. Yet, he has also been a staunch critic of the Federal Reserve chair Jerome Powell of late.
“I don’t see any reference to independence in the legislation that has defined the role of the Federal Reserve for the United States.”
Will Shelton Get the Job?
Political and economic analysts are largely on the fence about whether the Fed Board of Governors is about to get its first crypto-friendly member. Diane Swink, the chief economist for accountancy company Grant Thornton, said:
“If Congress is as committed to Fed independence as they appear to be, then it should be a no-brainer to take a pass.”
Others argue that President Trump, post-impeachment scandal, is keen to quiet dissent from within the Republican party. Monetary policy expert of the Cato Foundation George Selgin believes Shelton, alongside fellow Trump nominee Christopher Waller, both stand a good chance of election to the Federal Reserve’s board:
“… few Republican senators are likely to risk incurring Trump’s displeasure at a time when he’s feeling both triumphant and vindictive.”
If both Shelton and Waller are successful, Trump would have personally installed six of the seven governors. In Shelton, the US president would also have put someone very sympathetic to the ideas core to crypto assets in a very senior position at the world’s most powerful bank.
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