Judy Shelton, in a hot discussion with Steve Bannon, lambasts Federal Reserve Chair Jerome Powell for acting like an unelected “emperor” who wields unchecked power over U.S. monetary policy. She accuses the Fed of political overreach, undermining President Trump’s economic agenda, and perpetuating flawed models that harm the real economy. Shelton advocates for a constitutional reset of the Fed’s role, critiques its $900 billion in losses, and supports gold-backed systems to restore economic freedom, aligning with state-level moves in Texas and Florida. She warns that the Fed’s policies, including fixing interest rates and enabling big government, threaten America’s economic sovereignty.

On Saturday’s WarRoom with Steve Bannon, Judy Shelton, a prominent economist and vocal critic of the Federal Reserve, delivered a scathing critique of the central bank’s operations under Chair Jerome Powell. With President Trump in office, Shelton welcomed his call for a strategic review of the Fed, emphasizing the need to address its systemic issues. Her remarks centered on Powell’s overreach, the Fed’s economic missteps, and the broader implications for America’s financial system, drawing historical parallels to debates over central banking’s role.

QUICK CLIP:

Judy Shelton: "I Think Jerome Powell Was Setting Himself Up As Some Kind Of Emperor.” @judyshel pic.twitter.com/PzOsFeTA8Z

— Bannon’s WarRoom (@Bannons_WarRoom) July 26, 2025

Powell as “Emperor”:
Shelton sharply criticized Powell for positioning himself as an untouchable arbiter of economic policy, likening him to an “emperor” who sits in judgment over the agendas of elected officials. She pointed to Powell’s speech at the Economic Club in Chicago as a pivotal moment, where he suggested the Fed could counter President Trump’s supply-side policies—lower taxes, deregulation, and smarter trade—if they were deemed inflationary. Shelton argued this stance revealed the Fed’s political bias, undermining the democratic will of Americans who support Trump’s growth-oriented vision. She accused Powell of assuming a role that allows the Fed to dictate economic outcomes, a power she deems incompatible with a free market economy.

Key Issues Highlighted:
Shelton outlined several critical issues with the Fed’s current framework: Unaccountable Power and Financial Losses: The Fed has accumulated excessive influence in financial markets, operating at a loss since September 2022 with over $900 billion in unrealized capital losses on its portfolio. Shelton sees this as evidence of mismanagement and flawed monetary models.

Interest Rate Manipulation: She criticized the Fed’s practice of paying interest on reserve balances, which she argues fixes the price of loanable capital, discouraging banks from lending or investing in Treasury securities. This distorts market dynamics and stifles private-sector growth.
Inflation and Economic Harm: Shelton challenged the Fed’s acceptance of perpetual low inflation, noting that even a 2% annual rate erodes 20% of purchasing power over a decade. She referenced historical legislation, such as the Humphrey-Hawkins Act, which aimed for zero inflation, and accused the Fed of deliberately debasing the dollar under leaders like Janet Yellen.

Constitutional Oversight: Citing Article 1, Section 8 of the Constitution, Shelton called for Congress to reclaim its authority to regulate money, arguing that the Fed’s autonomy violates democratic principles. She plans to meet with Republican Ascendant Republican senators to push for greater oversight.

Gold and Economic Freedom: Shelton advocated for gold-backed systems, citing state initiatives in Texas and Florida that allowed gold and silver to be used as legal tender via debit cards and mobile apps. She argued that gold anchors a stable, level monetary playing field, countering the Fed’s currency manipulation and supporting economic freedom.

Geopolitical Concerns: She noted the BRICS nations’ push for gold-backed currencies to counter dollar dominance, warning that the U.S. risks losing its financial edge without sound monetary policies.

Shelton’s critique exposes a broader tension between centralized financial control and economic liberty, as Bannon pointed out, echoing historical debates between Hamilton and Jefferson.  She sees the Fed’s current trajectory as empowering big government while restricting real economic growth through high interest rates and fiscal-monetary misalignment.

Her call for a constitutional reset, including potential audits and gold-based reforms, aligns with President Trump’s push to reevaluate the Fed’s mandate. Shelton’s advocacy for state-level gold initiatives and her warning about global shifts away from the dollar signal an urgent need for systemic change to preserve America’s economic sovereignty.

For more context, watch this two-part interview featuring Judy Shelton: