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"We are in a bubble": Trump says the Federal Reserve has made the economy unstable

Sep 27, 2016, 07:19 IST

Federal Reserve Chairman Janet Yellen adjusts her glasses as she testifies on Capitol Hill in Washington, Tuesday, June 21, 2016, before the Senate Banking Committee. Yellen said the U.S. economy faces a number of uncertainties that require the Fed to proceed cautiously in raising interest rates.AP/Evan Vucci

Republican presidential candidate Donald Trump is going after Janet Yellen again, claiming that the Fed is creating an investment bubble.

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During the first presidential debate, Trump claimed that the economy is having "it's worst recovery since the Great Depression" and that nothing in the country is healing after the financial crisis.

Additionally, Trump said that due to record low interest rates from the Federal Reserve the country's economy is "in a very big bubble," with debt increasing while the "only thing going up right now is stocks."

Thus, when interest rates increase, the bubble will burst and the stock market will crash.

Trump also repeated his claims that the Fed is keeping interest rates low while President Obama is in office in order to keep the economy going until Obama is retired.

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"As soon as President Obama retires and goes to the golf course" the Fed will raise rates according to Trump.

The Federal Reserve is a politically independent institution that does not answer to the President.

NOW WATCH: STIGLITZ: It makes me crazy that everyone gets this wrong about the economy

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