"Markets are not efficient and markets move in both directions and at times they overshoot in both directions", Mnuchin said early Thursday in an interview on the sidelines of the International Monetary Fund annual meetings in Bali, Indonesia. Three have PhDs in economics and three have law degrees. "So you can say that well that's a lot of safety actually, and it is a lot of safety, and it gives you a lot of margins, but I think the Fed has gone insane". Higher interest rates makes it more expensive to borrow money, giving consumers or businesses pause before taking out a loan. "It's all about investors rethinking their exposure to stocks".
He has frequently criticised the United States central bank for gradually raising interest rates.
"The Fed's reckless policies of low interest and flooding the market with dollars needs to be stopped or we will face record inflation", he said in the other.
The Fed raised interest rates last month, and is expected to do so again in December.More news: Dow Jones plunges 800 points as tech stocks tumble
He added later, "The problem, in my opinion, is Treasury's and the Fed". The Fed's main interest rate, the federal funds rate, now stands between 2 and 2.25 per cent. Powell said last week he expects to stick with the current path of gradual interest-rate hikes while monitoring risks in the economy. "That doesn't seem especially surprising". He was persuaded by Treasury Secretary Steven Mnuchin that Powell, who was already a Fed governor, would be a force for stability.
The steep drop in Asia followed a decline on Wall Street of almost 830 points, the biggest fall since February, amid Trump's latest criticism of the Federal Reserve, the U.S. central bank.
During an event earlier Wednesday amid the sell-off, Trump and his top economic adviser, Larry Kudlow, said they believed the American economy was robust.
The gradually rising rates, Fed officials say, are meant to guard against any quick run-up in inflation, while remaining low enough so far for the recovery and a strong run of job growth to continue.More news: Sears may be days away from bankruptcy
"A lot of people were concerned when the QEs were done whether the Fed would ever be able to downsize and I think the market has handled the supply very well, ' Mnuchin said". "Where is the inflation that they are fighting?"
"The fundamentals of the USA economy continue to be extremely strong, I think that's why the stock market has performed as well as it has". Economic growth has improved, and Republicans have taken steps to cut taxes and regulations. And tech stocks got hit particularly hard.
But Trump loves to tout good economic news, and either dismisses bad economic news or blames it on the Fed.
Last week's jump in yields followed strong USA data but many analysts have been anticipating dynamics in the bond market to change due to expectations that central banks in Europe and Japan will soon phase out bond-buying programmes. "But I really disagree with what the fed is doing. OK?"More news: Princess Eugenie and Jack Brooksbank's wedding: How to watch in Canada