Ron Paul is no fan of the Federal Reserve, and the central bank meeting later this week prompted the former Texas politician to say the Fed is once again threatening the stock market and everyone who invests their hard-earned money.


“I think it’s always a threat because just their meeting and saying a few words one way or the other has a big effect,” Paul said. “They’re in a hot spot. They don’t know what to do.”

A once-hawkish Fed has taken a turn for the dovish in recent months, faced with pressure from President Donald Trump to ease off interest rate hikes and a market worrying about a potential recession as soon as this year.

The Fed is already toying with the idea of holding a larger balance sheet than previously thought, according to The Wall Street Journal on Friday. The central bank has been reducing its $4.5 trillion balance sheet since October 2017. On Thursday, Paul predicted the Fed might halt shrinking the balance sheet to counter a downturn this year.

“There’s too many unknowns and I think they’re going to have trouble [either tooling with interest rates or shrinking the balance sheet] and that’s just going to not only make the bubble persist, it’s going to make the bubble bigger and then when the final end of this comes it’s going to be that much worse,” said Paul.

Previously, Paul forecast a 50 percent drop in the stock market which could strike this year. He also called the stock market one of the biggest bubbles “in the history of mankind.”

The solution to this, says Paul, is for the arm of the Fed that controls monetary policy to stop doing just that.

“I don’t suggest anything other than getting the government out of the business, getting the Fed out of it and getting over into market rates because you can’t manage this,” he explained. “This is the fallacy but it’s ingrained.”

Fed Chair Jerome Powell and other members of the Federal Open Market Committee will convene on Tuesday for their two-day meeting. Markets are not pricing in a change in interest rates.