Tesla Investor Slams Jerome Powell Amid Rising Deficit And Inflation: 'US Cant Afford 5% Interest Rates'

A vocal Tesla Inc. investor, Ross Gerber, expressed his concern over the rising U.S. deficit and inflation rate in a post on X, formerly known as Twitter.

What Happened: Gerber highlighted that interest on U.S. debt is nearly equivalent to the country’s defense budget and criticized Federal Reserve Chair Jerome Powell‘s apparent indifference to the situation.

His post read, “The interest on US debt is almost equal to our defense budget. The fed is creating even bigger deficits which then, you guessed it, causes more inflation. The US cant afford 5% interest rates but Powell doesn’t seem to care… Looking at a $1.7 tril US deficit…”

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Why It Matters: Gerber’s concerns echo those of Peter Schiff, CEO and chief global strategist at Euro Pacific Capital, who recently claimed that both ‘Bidenomics’ and Federal Reserve rate hikes have failed to effectively manage inflation. Despite aggressive interest rate increases, inflation remains a pressing issue for the U.S. government.

Moreover, the robust performance of the U.S. economy, which has forced Federal Reserve officials to revise their 2023 growth projections, could trigger a reevaluation of interest rate cut projections for 2024.

Meanwhile, Mohamed El-Erian, chief economic adviser at Allianz, has predicted a pause in Federal Reserve rate hikes this September.

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