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President Trump is trying to tackle high prices by fiddling with America’s economy in vigorous and unusual ways.

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• To drive down prices and borrowing costs, he is exerting extraordinary pressure on the Fed to lower interest rates, as Richard Palmer reports this morning.
• To try to reduce mortgage rates, he directed Fannie Mae and Freddie Mac to acquire $200 billion in mortgage-backed securities. He also pushed to prohibit “large institutional investors” from purchasing single-family homes to curb corporate dominance in the rental market and free up homes for families.
• To combat high consumer debt, he proposed a one-year cap on credit card interest rates at 10 percent.
• To reduce energy prices, he urged American companies to invest $100 billion into the aging oil infrastructure of post-Maduro Venezuela.

All these interventions, while promising to alleviate short-term cost-of-living concerns for Americans, have potential negative effects, some unpredictable.

Such is the case with many of President Trump’s most muscular decisions of his second term. The mechanisms of prosperity, civil order, international relations and world peace are complex. But this doesn’t dampen the president’s confidence. It doesn’t instill in him humility or caution in taking dramatic action.

The extent to which these moves work to the nation’s favor will show God saving America “by the hand of Jeroboam.” However, it will not last. In the end, the curses of our disobedience will catch up to us as God works to lead us toward repentance. Headlines trumpeting the unintended consequences of the actions Trump is now taking are certain to multiply in the time ahead.

Will President Trump conquer the Fed? Is President Trump trying to get control of the U.S. Federal Reserve through blackmail? His Department of Justice has threatened to criminally indict Fed Chairman Jerome Powell on charges related to renovations at the Federal Reserve Board Building. Powell says this is a sham, arguing, “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”

Whether or not he’s right on this specific case, President Trump has made no secret of his desire to exert more control over the Fed. Investors around the world are watching the struggle carefully.

Who should control it? It’s a hard problem to solve.

• The First Bank of the United States was controversial from its inception to its expiration in 1811. President Andrew Jackson famously battled the Second Bank of the United States, following through on his “I will kill it” promise in 1832.
• The Federal Reserve was established in 1913 to perform similar functions yet avoid some of the problems of the banks.
• Up until the 1990s, elected officials had greater control over interest rates. But they could rarely resist the temptation to push down rates to try to win elections. Lower interest rates mean cheaper mortgages, cheaper business loans and more spending in the short term—but more debt and economic problems in the longer term.
• The next solution was to give power over interest rates to unelected experts. They’re not tempted to use them to “cheat” in elections. But under their watch, banks experimented with a massive quantitative easing program, creating money from nowhere to stabilize the economy during the 2008 financial crisis—and for years afterward. All that new money caused asset prices to soar. The rich, who own real estate, businesses and stocks, got richer. Those who rely on paychecks for most of their income stagnated.

Fixing this is one of the most important tasks of any politician. But how? President Trump’s push to lower interest rates will make mortgages cheaper—but at the expense of even more borrowing, even higher inflation, and a loss of any remaining confidence in the dollar.

The entire U.S. and global financial system is built on wrong foundations. It will never work perfectly, or even well. And the temptation of “cheats” and quick fixes will soon destroy the U.S.-dominated financial system, leading to extremely destructive times in the short term, but also paving the way for God’s perfect system just beyond.

Japan’s popular PM aims to claim more power: The Japanese are so enthusiastic about the hawkish, right-wing and pro-military stance of their new prime minister, Sanae Takaichi, that she now plans to dissolve the legislature’s lower house and hold snap elections next month.

Takaichi’s government has maintained popularity ratings of around 70 percent ever since coming into power in October. If her election bid is successful, this will convert her remarkable popularity into more seats for her Liberal Democratic Party, likely restoring its single-party majority that was lost under her predecessor. Reclaiming a majority would give Takaichi the political fuel to further accelerate Japan’s already rapid remilitarization.

• Takaichi has long called for Japan to revise Article 9 of its Constitution, the so-called pacifist clause that was designed to prevent a return to full militarism.
• Under Takaichi’s leadership, Japan will reach its goal of spending 2 percent of gdp on defense, almost two years ahead of what was already a remarkably ambitious schedule.
• “I think we should possess nuclear weapons,” a senior security official in her cabinet told reporters on December 17. “In the end,” the official said, “we can only rely on ourselves.”
• In November, Takaichi said in the Diet: “If China invades Taiwan,” Japan would consider it an “existential crisis situation” and possibly deploy its Self-Defense Force.

The statement infuriated the Chinese, who retaliated with tighter import and export restrictions, but it struck a chord with Japan’s increasingly nationalist population.

“Conservatives welcome her remarks. … Business leaders may be worried about the economic relationship with China, but ordinary voters are not so worried about that. Her hawkishness reflects the new political atmosphere of Japan.”
—Yu Uchiyama, Tokyo University political scientist

From contenders to comrades: At present, hostility and fear are intensifying between Japan and China, motivating both of these world-leading peoples and economies to build up extraordinary military power and fueling the sky-high popularity of hawkish leaders such as Takaichi. But biblical prophecy shows that these two countries will soon come together, if only briefly, under Russian leadership, turn their power against the West, and help unleash the most devastating war in mankind’s history.

Will Germany unleash its spies? Germany’s foreign intelligence agency, the bnd, will become much more powerful and independent from the U.S. if a new law is passed, German media reported last week. Given the bnd’s history, such increased power should alarm the current and future targets of German spies.

• Draft legislation seen by the Süddeutsche Zeitung and public broadcasters ndr and wdr would remove significant constraints on the bnd, empowering it to the level of the National Security Agency in the United States or the Government Communications Headquarters in the United Kingdom.

The increase in power coincides with increased distrust of the U.S. The draft legislation enables the bnd to infiltrate U.S. social media companies on the grounds that they don’t voluntarily provide enough data to the German government.

• Currently, the bnd monitors all Internet traffic going through Europe’s largest hub, located in Frankfurt. The chancellor’s office now wants to allow the bnd to store and sort all this data for up to six months and not only allow spying on foreigners but also on German citizens and those they interact with around the world.
• The bnd could also be empowered with greater cyberwar capabilities, including authorization to hack information technology infrastructure both in Germany and abroad to fend off cyberattacks.

The new bnd would pose a national security risk to the U.S. Underlining this fact is the recent confirmation that bnd agents spied on U.S. President Barack Obama in 2013 while simultaneously decrying U.S. spying on Chancellor Angela Merkel.

The creator of Germany’s postwar spy network and founding president of the bnd was Gen. Reinhard Gehlen, a former Nazi. (Read “Germany’s Secret Service Scandal.”) Prophecy reveals that the German underground will not only rise up as the prophesied beast of Revelation 17 but also target America and Britain for infiltration and destruction.

IN OTHER NEWS

Attack in Rafah endangers ceasefire: Six Palestinian terrorists were killed while assaulting Israel Defense Forces troops yesterday in Rafah in what Israel called a “serious violation” of the United States-brokered ceasefire with Hamas. This comes as the ceasefire’s second phase is to be implemented, in which Hamas is to lay down arms in exchange for Israel’s withdrawal from Gaza. U.S. President Donald Trump claimed that the ceasefire would bring “eternal peace,” but attacks like yesterday’s show otherwise.

Russia stirs the pot in Greenland: Russian Security Council Deputy Chairman Dmitry Medvedev said Monday that the people of Greenland may vote to join Russia if President Trump does not swiftly establish U.S. authority over the Arctic island. “Trump needs to hurry,” the former Russian president wrote. “According to unverified information, in a few days there could be a sudden referendum, at which the entire 55,000-strong Greenland could vote to join Russia. And then that’s it. No new little stars on the [American] flag.” Watch for Russia to keep exploiting tensions in the nato alliance, with public trolling, backchannel influence and political pressure, as it seeks to divide and weaken the alliance.

“A robust public digital euro is our only defense.” On Sunday, 70 European academics urged members of the European Parliament to adopt a “strong public digital euro” to safeguard “European sovereignty, stability and resilience.” Dependence on U.S. payment providers exposes Europeans “to geopolitical leverage, foreign commercial interests, and systemic risks beyond Europe’s control,” their statement said. They said they fear that U.S.-backed private digital currencies will cause Europe to “lose control over the most fundamental element in our economy: our money.” The European Central Bank is currently preparing a digital euro, but tensions with the U.S. could speed up its implementation. The Bible reveals that Europe, Latin America and Asia will turn against the U.S. in an unprecedented trade war and economic siege.