--- title: Janet Yellen: Trump Doesn't Understand Economic Policy description: The former head of the Federal Reserve thinks President Donald Trump doesn't understand economics, the central banking system or trade. canonical: https://time.com/5537309/janet-yellen-donald-trump-interview/ author: Abby Vesoulis article:opinion: false article:content_tier: free article:published_time: 2019-02-25T21:12:32.000Z article:modified_time: 2026-08-04T07:52:55.545Z article:section: Politics og:title: The Nation's Former Top Banker Thinks Donald Trump Doesn't Understand Basic Economics og:description: Bilateral trade deficits are 'not an appropriate objective of policy,' she said og:url: https://time.com/5537309/janet-yellen-donald-trump-interview/ og:site_name: TIME og:image: https://static.time.com/v3/assets/bltea6093859af6183b/blt65978f8d23261c7f/6988e67be76ad24a6663001c/janet-yellen-federal-reserve.jpg?branch=production&width=1200&quality=75&auto=webp&crop=16:9 og:image:width: 3683 og:image:height: 2072 og:image:alt: Janet Yellen og:type: article twitter:card: summary_large_image twitter:title: The Nation's Former Top Banker Thinks Donald Trump Doesn't Understand Basic Economics twitter:description: Bilateral trade deficits are 'not an appropriate objective of policy,' she said twitter:image: https://static.time.com/v3/assets/bltea6093859af6183b/blt65978f8d23261c7f/6988e67be76ad24a6663001c/janet-yellen-federal-reserve.jpg?branch=production&width=1200&quality=75&auto=webp&crop=16:9 ---  # The Nation's Former Top Banker Thinks Donald Trump Doesn't Understand Basic Economics > Sponsored content. 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Brief is TIME's Washington newsletter, written by senior correspondent Philip Elliott. It explains the politics, personalities and power dynamics behind the headlines, three times a week. It reaches 85,000 subscribers with a 37.0% open rate as of August 2026. #### Where can I get analysis of Washington politics by email? D.C. Brief is TIME's free Washington politics newsletter, available at time.com/newsletters. It is written by a TIME senior correspondent who covers the capital full time. #### Who writes TIME's D.C. Brief? Philip Elliott, a senior correspondent at TIME, writes D.C. Brief. #### Is D.C. Brief free? Yes. D.C. Brief is free at time.com/newsletters. ## Video: President Trump Nominates Jerome Powell for Next Fed Chair [Watch (HLS stream): President Trump Nominates Jerome Powell for Next Fed Chair](https://cdn.jwplayer.com/manifests/qgoHGHwZ.m3u8) (1:24)  _Published 2017-11-02. President Donald Trump tapped Jerome Powell on Thursday to replace Janet Yellen as Fed chair when her term ends in February, choosing a moderate member of the Fed's board who has backed Yellen's cautious approach to interest rate hikes._  by [Abby Vesoulis](https://time.com/author/abby-vesoulis/)  ## Abby Vesoulis Feb 25, 2019 9:12 PM UTC  Federal Reserve Chair Janet Yellen at the Federal Open Market Committee meeting in Washington on Sept. 20, 2017 Federal Reserve Chair Janet Yellen at the Federal Open Market Committee meeting in Washington on Sept. 20, 2017Pablo Martinez Monsivais—AP  by [Abby Vesoulis](https://time.com/author/abby-vesoulis/)  ## Abby Vesoulis Feb 25, 2019 9:12 PM UTC The former head of the Federal Reserve thinks President Donald Trump doesn’t understand basic economics, the central banking system or international trade. But she said it in such a way that you might have missed it. In an [interview with Marketplace that aired Monday](https://www.marketplace.org/2019/02/25/economy/janet-yellen), former Federal Reserve chair Janet Yellen was asked if she thinks Trump “has a grasp of” macroeconomic policy, which encompasses everything from unemployment to the rates on bank loans. “No, I do not,” replied Yellen, who served under Trump during his first year in office. Her other comments were equally harsh and extremely unusual for the nation’s former top banker to say about a U.S. president, but they were framed in the typical circumlocution of the Federal Reserve, where she served for 14 years. Yellen, who was nominated as Fed chair by President Barack Obama, said that she doubts that Trump could name its two basic goals of reducing unemployment and staving off inflation, adding that his remarks about what the central bank should do on trade — an area outside its main priorities — showed he doesn’t know how it works. “I think comments like that shows a lack of understanding of the impact of the Fed on the economy,” she said. Yellen and Trump have a complicated history. During the 2016 election, Trump [harshly criticized her](https://www.nytimes.com/2016/09/28/us/politics/donald-trump-janet-yellen-federal-reserve.html), arguing without evidence that she was doing the bidding of President Barack Obama at the strictly independent central bank. As president, he [considered reappointing her](https://www.washingtonpost.com/politics/trump-slams-fed-chair-questions-climate-change-and-threatens-to-cancel-putin-meeting-in-wide-ranging-interview-with-the-post/2018/11/27/4362fae8-f26c-11e8-aeea-b85fd44449f5%5Fstory.html?utm%5Fterm=.19e978f7aca2) but reportedly asked economic advisers if the 5-foot-3 economist was too short for the job. In the interview, Yellen said she was perplexed by Trump’s focus on trade deficits, which is when the U.S. imports more from a particular country than it exports to them. Trump has repeatedly cited trade deficits with China and other countries as a problem he wants to address, but [economists largely agree](https://www.bbc.com/news/world-43336599) that they don’t really matter since the U.S. economy is now largely centered on services and not manufacturing. “I think almost any economist would tell you that there’s no real meaning to bilateral trade deficits,” Yellen said. Still, Yellen was circumspect about Trump’s policies on trade overall, arguing that although he’s gambling the health of the economy during negotiations with China and other countries, it might turn out OK if it ends with better trade deals. “I think that’s creating a lot of uncertainty for businesses, and I think my own view is that those shifts are likely to be adverse for the U.S. economy, to the extent that some of these things are bargaining chips, with the hope of lowering trade barriers generally.” “I suppose the outcome of that, if it’s successful, could be positive…” she said. Host Kai Ryssdal interjected to say that’s “a big ‘if.'” “It is as a big ‘if,'” Yellen agreed. ```json [{"@context":"https://schema.org","@type":"NewsArticle","@id":"https://time.com/5537309/janet-yellen-donald-trump-interview/","mainEntityOfPage":{"@type":"WebPage","@id":"https://time.com/5537309/janet-yellen-donald-trump-interview/"},"headline":"The Nation's Former Top Banker Thinks Donald Trump Doesn't Understand Basic Economics","datePublished":"2019-02-25T21:12:32.000Z","dateModified":"2026-08-04T07:52:55.545Z","description":"\"I doubt that he would even be able to say ... the Fed's goals\"","url":"https://time.com/5537309/janet-yellen-donald-trump-interview/","keywords":["Economy","Janet Yellen","Federal Reserve","Donald Trump"],"thumbnailUrl":"https://static.time.com/v3/assets/bltea6093859af6183b/blt65978f8d23261c7f/6988e67be76ad24a6663001c/janet-yellen-federal-reserve.jpg?branch=production&width=1200&quality=75&auto=webp&crop=1200:675&height=675","author":[{"@type":"Person","name":"Abby Vesoulis","jobTitle":null,"url":"https://time.com/author/abby-vesoulis/"}],"articleSection":"Politics","image":[{"@type":"ImageObject","url":"https://static.time.com/v3/assets/bltea6093859af6183b/blt65978f8d23261c7f/6988e67be76ad24a6663001c/janet-yellen-federal-reserve.jpg?branch=production&width=1200&quality=75&auto=webp&crop=1200:675&height=675","width":1200,"height":675,"headline":"Janet Yellen","caption":"Janet Yellen","creditText":"Pablo Martinez Monsivais—AP","representativeOfPage":true}],"publisher":{"@type":"Organization","name":"Time","url":"https://time.com/","logo":{"@type":"ImageObject","url":"https://time.com/images/logo.png","width":528,"height":156},"foundingDate":"March 3, 1923","sameAs":["https://www.facebook.com/time","https://www.instagram.com/time/?hl=en","https://twitter.com/time","https://www.pinterest.com/timemagazine"]}},{"@context":"https://schema.org","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"item":{"@id":"/section/politics/","name":"Politics"}},{"@type":"ListItem","position":2,"item":{"@id":"/tag/economy/","name":"Economy"}},{"@type":"ListItem","position":3,"item":{"@id":"https://time.com/5537309/janet-yellen-donald-trump-interview/","name":"The Nation's Former Top Banker Thinks Donald Trump Doesn't Understand Basic Economics"}}]},{"@context":"https://schema.org","@type":"VideoObject","name":"President Trump Nominates Jerome Powell for Next Fed Chair","description":"President Donald Trump tapped Jerome Powell on Thursday to replace Janet Yellen as Fed chair when her term ends in February, choosing a moderate member of the Fed's board who has backed Yellen's cautious approach to interest rate hikes.","thumbnailUrl":"https://cdn.jwplayer.com/v2/media/qgoHGHwZ/poster.jpg?width=720","uploadDate":"2017-11-02T20:54:13.000Z","contentUrl":"https://cdn.jwplayer.com/manifests/qgoHGHwZ.m3u8","embedUrl":"https://time.com/5537309/janet-yellen-donald-trump-interview/","duration":"PT1M24S","potentialAction":{"@type":"SeekToAction","target":"https://time.com/5537309/janet-yellen-donald-trump-interview/?jw_start={seek_to_second_number}","startOffset-input":"required name=seek_to_second_number"}}] ```