Jerome Powell stood up in front of some people and read from a script on Thursday.
I could leave it there. Seriously. What if I did that? I wonder sometimes what this site would look like if I told you only what you needed to know, and exactly nothing more.
If you’re following along even casually, you know what Powell said about the economy and policy during his Thursday “conversation” in Dallas. He said the economy’s strong, and that as such, there’s no hurry to cut rates. (Which explains why the Fed cut them last week and will almost surely cut them again in a little over a month.)
The exceptional resilience of the US economy means the Fed can “approach our decisions carefully,” and for anyone who might’ve been inclined to suggest policy’s on a preset course now that cuts have commenced, know this: “The path of the policy rate will depend on how the incoming data and the economic outlook evolve.”
Let me tell you something else about “the path of the policy rate” in 2025. It’s going to be beset on all sides by the inequities of the selfish and the tyranny of evil men.
Powell didn’t mention Trump on Thursday, but the long shadow of the election will loom over everything the Fed does going forward and Trump’s ears will be tuned to every public (and who knows, maybe even every private) utterance from officials.
If we’re honest, all the rest will be more or less irrelevant depending on what sort of executive Trump plans to be vis-à-vis the Fed this time around. And I think we all know the answer to the implicit question there. Trump’s going to overreach and encroach on US monetary policy at every possible turn.
When he does, everyone on Wall Street will dance around the issue and otherwise try to explain away and excuse the inexcusable by reference to a Rolodex of rationalizations and apologies like, “The Fed was never apolitical anyway.” And “All presidents pressure the Fed.” And so on.
Wall Street will be cowards in that respect, but I won’t blame analysts and strategists for that cowardice: If it’s between courage and a paycheck, I’d probably take the paycheck too, particularly if I had kids and a mortgage. Fortunately (Allahu Akbar), I have neither, and I sign my own goddamn paychecks (Allahu Akbar again), which means I’ll be free to lament the demise of Fed independence loudly and openly — at least until attorney general Matt Gaetz has me arrested for subversion.
In the same Thursday remarks, Powell reiterated that “the labor market has cooled to the point where it is no longer a source of significant inflationary pressures,” and said the Fed’s “committed to finishing the job.” Yadda, yadda.
I hope (against hope) that Powell will at some point take a strident, pubic stand to protect the institution he’s duty-bound to safeguard. Because that institution, like every other American institution, is about to undergo a trial by fire. If Powell thought the inflation fight was hard, that was nothing compared to the forthcoming war for the Fed’s independence.
The storm’s comin’ Jay. Really it is. Blessed is the Fed Chair who, in the name of charity and good will, shepherds the weak through the valley of darkness. For he is truly his brother’s keeper and the finder of lost children.
I hope the guardrail holds. Bannon reacted negatively to the guardrail holding in the face of onsluaght. Thune’s election was derided most strongly among the Magat’s. Bannon knows Thune was aware of McConnel’s statement that impeachment can last all of an hour, note in the house and subsequent vote in the senate. The trial may take a bit longer.
Donnie is not yet president and has not got any of his picks through the senate. The senate is not likely this time around to rubber stamp everything Donnie does to surbvert the rules. Afterall they answer to the elite who are not likely to fare well under the thumb of Trump.
What should trouble the people more in this space is the statements surrounding changing tax policies. Jr. went to an investment firm (OK, sounds harmless) Pappy has said we should have a wealth fund funded by tariffs. Tariffs by the way are not controlled by Senate or Congress, therefore the Trump family could take control over the USA’s system of taxation and tax distribution. Convenient for sure but Tariff’s are a rapid path to economic ruin.
Are these financial people paying attention? Likely not, the media certainly is not. I think this is more likely than not, Donnie likes to sneak around to get his dirty work done. This is just sneaky, snarky, slimy, profitable and ILLEGAL enough to get Donnie excited.
Trump’s ears, in the guise of the NSA, tuned to private conversations is quit chilling!
Your movie references (on top of the impeccable writing and well-chosen topics) are among the reasons your site stands out among others!
Unfortunately in this Pulp Reality there is no Marcellus to send the Wolf to solce problems…
The Fed is a fairly recent creation which has faced opposition from various voices since it was created. Currently here is a small but noisy constituency in Congress which would be happy to see it eliminated.
And return to the past with almost endless financial crisis prior to the fed? Or ask the big banks to step in and do what the FED does? Someone has to do it in a modern economy. WE have had an almost uniterrupted economic expansion since the FED was put into place. Why give up now over some rhetoric completely devoid of serious analysis?
Some will counter you by suggesting that we return to the gold standard. In line with JL’s comments.
SENATOR Rand Paul is an advocate of eliminating the Fed, as per this breathless headline from a “freedom lovers” website: Ron Paul expresses interest in working with Elon if Trump is elected: ‘Let’s end the Fed!’
That’s from a sitting US senator, not a commentator on the Daily Stormer.
“They” (Project 2025 and its ilk) want to get rid of the FDIC too, for reasons that are unclear to me. And some of “them” (Heritage Foundation, etc) want to get rid of deposit insurance, to increase “market discipline”.
Maybe Powell will rise to the occasion, He buckled under DJT’s pressure in late 2018 and early 2019. He sounds ready, but repeatedly going through a gauntlet of attacks from DJT and his minions will be the true test.