Trump's 1% Interest Rate Demand Sparks Warning of Economic Catastrophe

President Donald Trump's repeated calls for the US Federal Reserve to slash interest rates to 1% have been met with skepticism by analysts. As a lifelong real estate investor, Trump may be expected to know better that such a drastic cut would likely cause massive dislocation in the global financial system.

According to J. Benson Durham, founder of DASM investment research firm, a 3-percentage-point cut 'seems cataclysmic.' This could lead to Treasury rates climbing as investors price higher inflation, countries like Germany soaking up capital by offering just a bit more to lenders than the US, and the dollar plummeting.

Despite these concerns about Fed credibility, Trump has repeatedly called for ultra-low borrowing costs, which he says the US deserves as the world's largest economy with, he argues, the safest credit.