It’s Jackson Hole week. Write your own jokes. There are plenty. Almost all of them involve Donald Trump and Jerome Powell.

This year’s symposium topic is “Labor Markets in Transition: Demographics, Productivity and Macroeconomic Policy.”

That seems apt. After all, the US labor market’s in “transition.” Specifically, it’s transitioning from adding jobs to not adding jobs, and maybe even losing some. That’s if you believe the outsized revisions to recent headline hiring prints. Trump doesn’t believe those revisions, or perhaps it’s more accurate to say he doesn’t know whether to believe them or not, but they reflect poorly on “his” economy, so he says he doesn’t believe them.

There’s the chart. According to Trump and the people who hold up the tails of his robe while he lumbers about, 2025’s YTD revisions are evidence that the numbers are “rigged.” Never mind that similar revisions occurred last year and the year before that too. (Trump’s gripe is that well more than half of the YTD 2025 downward adjustment was delivered all at once, in the May/June revision which cost Erika McEntarfer her job.)

It’s possible, I suppose, there’s a conspiracy afoot. It’s also possible (read: far more likely) that the revisions simply reflect deteriorating data quality post-pandemic. Initial response rates for the jobs report are now below 60%, after all. That’s down 10ppt compared to the pre-pandemic average. Trump’s federal hiring freeze doesn’t help to the extent it adds a resources constraint for the BLS.

The irony’s always the same, and Trump runs into this fairly often: He needs soft data so the Fed can justify the rate cuts he wants. But that’s a tradeoff he isn’t willing to make. Like any “good” populist, he wants a hot economy and rate cuts to make it run even hotter. That’s a recipe for inflation, but the “good” news there is that inflation helps when you have a debt problem. And red-hot nominal growth flatters fiscal ratios that might otherwise reflect poorly on your management skills.

Anyway, Trump’s the elephant in the room at Jackson Hole, just like he’s the elephant in every room, everywhere. And look: That’s not necessarily criticism. He’d have it no other way. In fact, Trump goes out of his way to be sure that his rotund presence is felt wherever important policy matters are being discussed and debated, even when he’s not there physically.

Whatever else he says on Friday in Wyoming — i.e., setting aside the technicalities of any new Fed approach to its policy framework — Powell has to deliver on expectations for a dovish pivot vis-à-vis the September FOMC meeting. Credit where it’s due: Jay’s proven he isn’t a pushover, but that’s beside the point by now. Stephen Miran’s about to be on the Board. This is a losing battle. There’s no point fighting it anymore.

If the Committee doesn’t cut next month, there’ll be three governor dissents: Chris Waller, Miki Bowman — both of whom dissented in July and both of whom have been considered by Trump for Powell’s seat — and Miran, assuming the Senate rubber-stamps him in time for the meeting. You can’t have three governor dissents. That’s a bad look. And Powell won’t do it. So, may as well go ahead and confirm what the market’s already pricing at ~85% anyway: A September cut.

The figure shows you pricing for the remainder of 2025. Some of the “extra” cut premium beyond two fully-priced quarter-point moves came out in recent days on the heels of the warm PPI release. Honestly, I don’t see the Fed getting to year-end without delivering 75bps of cuts, at least. The pressure’s unrelenting from The White House. That shouldn’t matter, but let’s stop kidding ourselves: It does.

If you’re Powell, the fight now isn’t to hold out on lowering rates. He should retreat strategically, where that means deliver a succession of quarter-point cuts and then put the onus on Scott Bessent (because nobody takes Trump’s “We should cut by 400bps” rhetoric seriously) to explain why the Fed should be cutting in half-point increments with inflation running nearly a full point higher than target. The only way for Bessent to argue for big cuts in a hurry is to concede the labor market’s faltering. He won’t want to do that, and if you get Fed funds down to say, 3.5% by year-end, you take away the “policy shouldn’t be restrictive” criticism too.

Admittedly, it’s too late for all that. I’d put Powell’s odds of making it to the end of his term as Chair in May at 40%, if that. Note that no one even doubts anymore whether Trump can force him out. That used to be a highly contentious point. Now, most people assume that one way or another, Trump can remove Powell. That’s evidence of how we’ve normalized Trump’s behavior. What was “unthinkable,” “impossible” and “illegal” during his first term is just par for the course in his second. I can’t wait for Trump 3.0.

Other than Jackson Hole, the data docket in the US is more or less empty. The July FOMC minutes will be released into a hazy summer drift on Wednesday. Waller and Bowman already explained their dissents, so I’m not sure there’ll be much to glean from the official account of the meeting.

For housing market aficionados, NAHB’s due Monday, starts and permits Tuesday and existing home sales Thursday. S&P Global will release preliminary PMI results for the US on Thursday as well.