President Donald Trump is considering firing Treasury Secretary Steven Mnuchin after he failed to calm Wall Street fears amid a sliding stock market, CNN reports.
Mnuchin may be in “serious jeopardy” after the market saw its worst Christmas eve in history Monday. The Dow Jones dropped 653 points.
"Mnuchin is under the gun," a source told CNN.
Mnuchin is currently in Mexico’s Cabo San Lucas on vacation, even as negotiations to reopen the government continue.
Mnuchin, a former investment banker, announced over the weekend that he had spoken with the heads of all the major American banks in an attempt to allay worries.
Mnuchin tweeted that the banks have “ample liquidity” to lend to consumers and businesses.
Trump has praised Mnuchin in public.
“Yes, I do,” Trump said Tuesday when asked if he had confidence in his Treasury Secretary, adding that he was “very talented” and a “very smart person.”
Mnuchin move slammed:
Many analysts were puzzled by Mnuchin’s statement and warned that he may spark fears in his statement trying to diminish fears.
“Some market participants, however, questioned why Mnuchin answered a question that no one was asking,” Bloomberg reported. “Even after recent market losses, a liquidity squeeze or fresh financial crisis hadn’t been on the market’s mind. Mnuchin’s assertion of ample liquidity risked raising doubts.”
“Mnuchin isn’t helping,” Mayra Rodriguez Valladares, a former foreign-exchange analyst for the Federal Reserve Bank of New York, told Bloomberg. “For him to come out and explain what Trump is expressing is bizarre. It adds to the nervousness.”
Trump rages at Fed chair over stock market slide:
"They're raising interest rates too fast," Trump complained about the Federal Reserve on Christmas.
Mnuchin tweeted that Trump has denied reports that he wants to “fire” Federal Reserve Chairman Jerome Powell.
“Still, sources have previously told CNN that Trump was upset with Mnuchin over his advice to appoint Powell as Federal Reserve chairman,” CNN reported. “Trump has criticized Powell and the Fed for increasing interest rates, subjecting Powell to the kind of scathing public critique that is common for senior Trump appointees but which threatens the political independence of the worlds most powerful central bank.”
