White House National Economic Council Director Kevin Hassett has issued sharp criticism regarding the Federal Reserve's internal decision-making tendencies and clearly expressed concerns over the path of interest rates.
In a July 1st interview with Fox Business, Hassett stated his concern that a majority of members under Fed Chair Jay Powell may not be voting based purely on economic data, but rather with political motivations "targeting Trump". He emphasized that the White House needs to maintain close watch on this matter.
Discussing potential successors, Hassett said that if Kevin Warsh were to lead the Fed, he would face the formidable task of "uniting people", and it could be assured that any policy missteps "would not be Warsh's responsibility". He also stated plainly that raising interest rates under the current economic conditions would constitute a "macro-level mistake".
AI as the Core Engine for Productivity Growth
Regarding the US economic outlook, Hassett displayed a notably optimistic attitude. He anticipates that US economic growth in the second half of this year could reach approximately 4%.
The significant force driving this round of growth is artificial intelligence. Hassett stated that the White House has observed that companies deploying AI on a large scale are gaining substantial competitive advantages, with related firms seeing revenue growth of 100% and significant increases in employment size, while companies not adopting AI have seen growth nearly stagnate.
In his view, AI not only helps companies optimize inventory management and reduce operational costs but will also continuously enhance profitability and overall productivity, which is a key reason the US economy can maintain robust growth.
Simultaneously, Hassett indicated that the White House is working with technology companies to establish an AI safety and security framework, aiming to promote the widespread application of AI while preventing the technology from being maliciously misused as much as possible, allowing the benefits of AI to be released over the long term.
Additionally, Hassett revealed that the Strait of Hormuz has now largely returned to normal navigation. With the stabilization of this globally critical oil transport chokepoint, recent concerns in the energy market about supply disruptions have also eased.
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