Anyone who accrues one of President Trump’s derogatory nicknames must know there is a target on his back. Trump’s latest target is Federal Reserve Chair Jerome Powell. On Monday, Trump dubbed him “Jerome ‘Too Late’ Powell,” adding on Wednesday that “‘Too Late’ should resign immediately!!!” Trump himself elevated Powell to the role in 2018, but Trump now charges him with responding too sluggishly to changing economic conditions. In particular, Trump wants the Federal Reserve to dramatically reduce interest rates, which he argues is needed to create roaring economic growth.

After months of pestering Powell about cutting rates, Trump’s slow-drip pressure on Powell has swelled to a torrent. On Sunday, he complained that “we have a bad Fed chairman” who “keeps the rates artificially high.” Trump added he thinks the rate “should be at 1% or 2%,” while it currently stands between 4.25% and 4.5%. On Monday, Trump sent Powell a note, “Jerome, you are, as usual, too late. You have cost the U.S.A. a fortune and continue to do so.” Trump has floated a plan to name Powell’s replacement as a “shadow Fed chair,” even though Powell’s term does not expire until May 2026.

On Wednesday, a Trump administration official, Federal Housing Finance Agency (FHFA) Director Bill Pulte, called for Congress to “investigate Chairman Jerome Powell, his political bias, and his deceptive Senate testimony [over Federal Reserve building renovations], which is enough to be removed ‘for cause.’” Federal Reserve positions are not held “at will,” which means the president cannot fire the chairman except “for cause,” a requirement the U.S. Supreme Court reinforced in a May ruling.

For President Trump, his quarrel with Powell is an exercise of political will. Trump has an economic agenda, and he is not about to let the Federal Reserve chairman stand in his way. Trump’s agenda is simple: grow, baby, grow. He wants to steer his souped-up economy into a liberating expanse, open up the throttle, and let ‘er rip!

The Federal Reserve, by nature, is far more cautious. For nearly a century, its job has been to avoid the opposite extremes of high inflation and high unemployment. It seeks stability by trying to chart a middle course.

The president’s frustration may stem from the fact that macroeconomic policy has two main elements, fiscal policy (how much a government taxes and spends) and monetary policy (how much money is in circulation). In the American system, Congress and the president set fiscal policy, while the central bank largely controls monetary policy.

Indeed, there are good reasons not to put monetary policy under the direct control of Congress or the White House. If the 14 members of the Federal Reserve Board are too slow at changing the interest rate, can you imagine how slow it would be if it were set by Congress?

Furthermore, the Federal Reserve’s semi-independence from the president insulates against excessive political pressure. Just imagine if, while President Joe Biden was calling inflation “transitory” in 2021-2022, he had the power to set monetary policy; he may have kept it down for far longer than the Fed ultimately did, merely as political cover for his own statements and agenda.

This does not mean the Federal Reserve is above criticism or has not made mistakes. By not raising rates more quickly in 2021-2022, it did allow far too much inflation. By holding interest rates artificially low since the Great Recession, it incentivized the government to assume more unwise debt. There are many legitimate criticisms.

But the Federal Reserve’s mission is notoriously difficult, and the consequences for failure are colossal. The Fed is essentially tasked with predicting and successfully reacting to the future. It involves intense economic modeling, delving deeply into macroeconomic signals, and foreseeing likely developments. It’s a bit like meteorology, except that thousands of people don’t lose their jobs when the weatherman overlooks an afternoon shower.

The Federal Reserve has enormous economic power, of a sort, but precious little information about how to use it (the good news is, they are usually aware of how little they know). It’s rather like someone piloting a humanoid battle-bot, except that its only vision comes through magnifying glasses, processed by computer. The pilot knows he controls a powerful machine, but he hardly knows enough about where it should step next.

To make their task even more difficult, the Federal Reserve does not even exercise direct control over their primary variable, the amount of money circulating in the economy. Instead, they influence this by raising or lowering an inter-bank interest rate, which affects other interest rates, which affects how much money is lent out to circulate in the economy. To continue the earlier analogy, this is like the battle-bot pilot having to control his machine by reaching across the room and tapping on buttons with a golf club.

Absurdly, many Americans with no training in macroeconomics or central banking arrogantly assume they could do a better job than those actually in charge of the Federal Reserve, and some feel no qualms about airing their ignorance publicly. Naturally, the Federal Reserve Board has grown adept at tuning out such chatter. But, when the president himself outlines a credible threat to undermine the board’s operations, that is no longer just chatter.

Ironically, Trump’s own economic policies have deterred the Federal Reserve from giving him the rates he wants. Last week, Powell told lawmakers that the Fed would likely have cut rates except for fears that Trump’s Liberation Day tariffs could cause inflation. “If you just look at the basic data and don’t look at the forecast, you would say that we would’ve continued cutting,” he said.

Powell elaborated at a banking forum on Tuesday, “In effect, we went on hold when we saw the size of the tariffs, and essentially all inflation forecasts for the United States went up materially as a consequence.”

This suggests that there is ground for Trump and Powell to work out their differences. Over the past decade, in which Trump has held a dominating position in American politics, he has demonstrated a remarkable pattern for working out deals with former opponents — those targets of his nickname — who seek to reconcile. The deal-making process generally involves haggling, horse-trading, and usually compliments.

Yet that isn’t necessarily the way the Federal Reserve works. The 14-member board votes on decisions, so other members could easily overrule any compromise Powell makes. More importantly, the members of the Federal Reserve board are economists more than politicians, and they make decisions based upon their reading of the economic data, not political pressures. They could be wrong, and they have been wrong, but their insulation from politics often yields sounder decisions than if politicians were the ones calling the shots.