Trump’s attack on Yellen, Fed could backfire

While it may be unorthodox for a presidential candidate to throw darts at a sitting Fed chair, a good many on Wall Street agree with Donald Trump’s criticism that the Fed waited too long to raise rates and that it could be fueling a bubble.

Trump, at the first presidential debate, said Fed Chair Janet Yellen has kept rates low for political reasons and that the Fed is creating a problem for the stock market that will show up when it starts raising interest rates.

“This is extraordinary. This is really unprecedented for someone this close to the presidency to criticize the Fed chairman in personal terms, very strident and personal terms. I can’t recall any precedent for that,” said Greg Valliere, global analyst with Horizon Investments. “I think the markets have to worry about this. I think there’s a real chance that he could align himself with the members of Congress that want to sharply curb the Fed’s independence.”