‘Making Money’ host Charles Payne explained on "Fox & Friends" Thursday the new challenges facing the Federal Reserve in light of President Biden's $300 billion student loan handout plan. The U.S. economy shrank at a slightly slower pace in the second quarter than previously reported, according to the Commerce Department.

STUDENT LOAN FORGIVENESS FOR $300 BILLION? NEW YORKERS SAY NO PROBLEM

CHARLES PAYNE: [Fed Chair Jerome Powell] is the guy everyone's watching. He's the guy who's going to more or less give us a hint as to how aggressively the Federal Reserve is going to fight inflation. This is a crazy balancing act, right? They've got to fight inflation because if they let it run too much, it will imperil the economy to a point where it would get to levels that no one alive has lived. But if they go too far, it can imperil our economy to levels that no one alive has lived. They're trying to do this balancing act. And by the way, their job just got so much more difficult yesterday with the stroke of a pen. What do I mean? President Biden keeps pushing free money into the economy, and they're trying to get people to stop spending money. Why do prices go up? Economics 101. Too much money chasing too few goods. Stop. Cool out. Take a break. This is crazy!

WATCH THE FULL INTERVIEW BELOW:

Charles Payne sends message to Biden: 'Stop with the free money. This is crazy!'

Biden approves $300B student debt handout as inflation soars