Former Fed Counsel Scott Alvarez on DOJ Probe into Chair Powell

DOJ Investigation into Fed Chair Powell

• 💡 Former Fed counsel Scott Alvarez believes the DOJ's investigation into Chair Powell is not about a genuine crime but rather an attempt to intimidate Powell and the FOMC.
• 🎯 The administration allegedly aims to pressure the Federal Reserve into adopting specific interest rate policies.

Lack of Evidence for Charges

• 🔍 Alvarez points to evidence posted by the Federal Reserve and Powell's statements to Congress, stating they match up.
• ⚠️ The standard for charges requires Powell to have knowingly and willfully made material false statements to mislead Congress, which the evidence does not show.

Timing and Motivation

• 🗓️ The investigation's timing, seven months after the renovation review and the president's visit, is questioned.
• 📌 Alvarez suggests the probe is timed with Powell's term as chair ending in four months, potentially as a tactic to influence his decision to stay on the board.
• ⚡ This action could backfire, potentially making Powell want to stay more if he was considering leaving.

Federal Reserve's Response

• 🏛️ The Federal Reserve has reportedly received subpoenas for information, and lawyers are gathering requested documents for the DOJ.
• ⚖️ Chair Powell has hired a law firm to defend himself in the event of any developments.
• 🚫 Alvarez does not foresee the investigation resulting in charges, nor does he believe a court would convict Powell of wrongdoing.