Boy, the jokes just write themselves, don’t they?

The Dow was down more than 1,000 points by noon on Monday, and there was no mystery as to why: A certain “major loser” ignored his Treasury Secretary (again) in favor of the squirrels with Saddam berets who live in his head and whisper to him about the “deep state” all day.

Just 11 minutes into the cash session on Wall Street, Donald Trump took to TruthSocial to make the case for what he described as “preemptive rate cuts.” By “preemptive,” Trump meant the Fed should try to get out ahead of the recession his tariffs are almost certain to trigger.

Between lower gas prices and the end of what he called “Biden’s egg disaster,” there’s “virtually no inflation,” according to Trump. According to the BLS and the BEA, core inflation’s still running ~a percentage point above the Fed’s target, and according to US households, the situation’s likely to get a lot worse, and in a hurry.

Whether Powell wants to admit it or not — and notwithstanding Chris Waller’s ludicrous contention that market-based measures of inflation expectations somehow matter more for inflation than the outlook of families whose consumption choices actually determine inflation outcomes — the chart below’s the main reason the Fed can’t cut rates any further.

Inflation expectations among households are unglued. That’s Trump’s fault. Obviously. The Fed had both of those measures largely under control until February. As soon as the new trade war started, things fell apart.

The final read on University of Michigan sentiment for this month’s due Friday. The inflation expectations indexes may be revised lower in light of the tariff “pause” — or maybe not considering multiple escalations with China since the preliminary release showed the five- to 10-year print jumping to the highest since 1991 and the 12-month outlook to the highest since the early 80s.

Not surprisingly, Trump claimed the 100bps of rate cuts the Fed squeezed in late last year were an attempt to “to help Sleepy Joe Biden, later Kamala, get elected.”

Plainly, Trump doesn’t know when the Fed started cutting. The first cut — the 50bps move — was in September. Harris had been the Democratic candidate for nearly two months by then. Biden wasn’t even in the picture. (Details, details, I know.)

Trump proceeded to predict “a SLOWING of the economy unless” — wait for it — “Mr. Too Late, a major loser, lowers interest rates, NOW.”

Markets were already on edge after Trump assailed Powell last week, and following remarks from Kevin Hassett who confirmed that, in fact, the White House is exploring avenues for removing Powell before his term ends. It’s possible the Supreme Court could indirectly facilitate that effort by overturning Humphrey’s Executor and Wiener v. US.

The very last thing — other than, perhaps, more tariffs — risk sentiment needed to kick off the new week was for Trump to call Powell a “major loser.”

You have to believe Powell’s had enough of this by now. He suffered a year and a half of incessant public derision during Trump’s first term, and now the threat to his position is much more serious than it was then.

Let’s be clear: Trump’s going to move against Powell. It’s just a matter of time. When he does, Powell will almost surely refuse to step down, and that’ll entail the Fed issuing some manner of official statement asserting its independence. Powell or Trump — quite possibly both — would sue, and the case would probably be expedited to SCOTUS.

Any guesses on how that’s likely to go over with markets? For the umpteenth time: This isn’t going to work. Trump’s completely out of control. Everyone (including and especially markets) knows it and yet no one in Congress, let alone in his cabinet, will do anything to stop it.