Ruddy: Trump's Real Enemy Is the Federal Reserve

President Donald Trump’s real enemy is not the media. It is the Federal Reserve.

Don’t get me wrong. The media is no friend of Trump.

Everything he says about their fake news and systematic bias is patently true.

In 2024, a Media Research Center (MRC) study documented the overwhelming negativity directed at Trump compared with the far more favorable treatment of Kamala Harris.

The MRC analysis of 660 campaign stories on the ABC, CBS, and NBC evening newscasts found that, from July 21 through Oct. 25, 85% of the evaluative coverage of Trump was negative, while 78% of the evaluative coverage of Harris was positive.

The pattern was consistent, measurable, and unmistakable.

Americans themselves rendered a devastating judgment on the media establishment. In 2024, they gave Trump a landslide electoral win.

The same media now screams about Trump’s “censorship.”

To be clear, Newsmax and I have always opposed efforts to restrict the press, whether those efforts come from the left or the right.

Yet the crocodile tears from some over free speech ring hollow.

Where was the big media when Twitter deplatformed Trump in 2021?

The same outlets that insist even murderers retain free speech rights suddenly had little to say when a former president was silenced.

Where were they when Nancy Pelosi’s allies held congressional hearings designed to pressure cable companies to “deplatform” Newsmax, Fox, and OAN from cable systems?

Parallel efforts sought to strip Fox of its television licenses.

Newsmax has consistently advocated for press freedom through both the Biden and Trump administrations.

Selective outrage is not principle.

Trump once told me the media was not his problem — he has always beaten them. He’s right on that point.

He succeeded despite the headwinds because the public has lost trust in the press.

Gallup reported last year that trust in the media hit a record low, with only 28% of Americans saying they had confidence in news reports.

The deeper threat to Trump and the GOP isn’t the media. It sits at the Federal Reserve.

The Fed sets the economic parameters that drive the economy, and it has long been Trump’s bête noire — the establishment’s preferred instrument of impairing him.

I watched it during Trump’s first term.

During Trump’s first term, impressive GDP growth arrived with virtually no inflation.

But Federal Reserve Chairman Jerome Powell still raised rates — jumping them roughly 500% from the level Trump started at in 2017.

The justification was always “inflation fears.” Trump pushed back hard.

Powell eventually lowered rates, but belatedly and only a bit.

I believe that if Trump had operated under the low-interest, quantitative-easing regime that characterized the Obama years, the 2020 race would not have been close. Trump would have won by a landslide.

It was no surprise when Biden reappointed Powell (“Thank you, Mr. Powell,” Biden must have said).

Under that leadership, the Fed and Powell gave the green light to the worst inflation the country had seen in a half century.

Biden-era stimulus programs dumped more than $7 trillion of largely unnecessary spending into the economy and, with it, wiped out nearly 25% of the dollar’s purchasing power.

The media never seems to note Powell’s central role in that outcome.

As Trump returned to power and inflation began dissipating, Powell again moved to raise rates.

Why? Again, we heard about “inflation fears.”

Trump, correctly, went right back at him.

Here are the facts backed up by the data: Inflation had been largely tamed by 2025.

There is no genuine monetary inflation.

On an inflation-adjusted basis, M2 Money Supply has been essentially flat for the past four years (you can see it on the Fed Chart here).

The velocity of money — the number of times a dollar is spent on goods and services in a given period — has remained low and relatively stable over the past four years, another sign of little inflation (see the Fed data here).

Coming into this year, the data simply did not support a case for raising rates and monetary tightening. It did suggest rates were too high.

Then the Iran conflict began in February and the Strait of Hormuz was largely closed.

As a result, we have witnessed “supply-shock” inflation — price increases driven by rising petroleum and natural-gas prices.

That shock is temporary and unrelated to domestic monetary conditions.

Raising rates does not fix supply-shock inflation, and it doesn’t lower gasoline prices.

But it does make the problem far worse by increasing costs across the board.

Instead, the Fed should be offsetting the rate shock by lowering short-term rates.

Had the federal funds rate been closer to 2% rather than the 5% range that prevailed for much of last year, Trump and Republicans would be sailing into the midterms.

Although the Fed does not set long-term rates directly, higher short-term rates still feed through the system.

And national debt service payments — a growing share of the federal budget — would have been cut almost in half under a lower-rate regime of 2%.

This, in turn, would have reduced pressure on longer-term borrowing costs, including mortgages.

The economy would have been running at full speed; an energy-price spike would have registered as a bump in the road rather than a broader threat.

Smartly, Trump wants change and knows rates should be lower.

Trump’s new Fed chairman, Kevin Warsh, is a fresh voice but only one vote of the 12-member Federal Open Market Committee that sets rates.

The current Board of Governors and the broader committee remain dominated by Powell’s acolytes.

The decision to keep rates elevated in the face of a supply-driven energy shock risks creating conditions for a housing market crisis just like 2008.

It’s the kind of perfect storm that tips an economy into a catastrophe.

Trump has made his case against the media and the public has rendered its own verdict of distrust.

The Federal Reserve, however, continues to set policy that targets and opposes Trump’s economic policies which are sensible and act to fuel growth, such as tax cuts and massive deregulation.

The public never elected the Fed, but is suffering today because of it.

The media may generate noise, but the Fed directly impacts your wallet – and elections. We’ll see that in November.

Christopher Ruddy is CEO of Newsmax Inc., one of the nation’s leading news channels and outlets. Read more Christopher Ruddy Insider articles — Click Here Now.

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