Trump's $5,000 Check Promise Sparks Alarm Among Analysts

The Federal Reserve's rate hike on Wednesday is unlikely to sit well at the White House, given President Donald Trump's economic views. A recent pledge by Trump to provide $5,000 checks for every American has sparked alarm among some analysts, particularly Kevin Warsh, who may find this proposal too monetarist.

The promise of a $5,000-per-person dividend, made in the event Republicans retake Congress, is seen as unrealistic. Even if they were to succeed in November's midterms, there's no clear funding source for the estimated $1.2 trillion cost. Tariff revenue projections would not come close to covering it, and adding to the U.S. Treasury's debt mountain while struggling with high borrowing rates is a concern.

Betting markets currently give more than a 50% chance of a Democratic sweep of both houses in seven weeks' time, making Trump's pledge even less likely to materialize. The proposal may be seen as an attempt by the White House to counter economic uncertainty ahead of the midterms.