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re: Jerome Powell refuses to cut rates in his final act.
Posted on 4/29/26 at 3:39 pm to Kreg Jennings
Posted on 4/29/26 at 3:39 pm to Kreg Jennings
quote:All true.
oil spiking from around $75 per barrel to over $100 per barrel over the last couple of months. Oil prices affect the poorest of the poor and the richest of the rich.
What effect will maintaining or increasing FFRs have on those oil prices?
0
Posted on 4/29/26 at 3:46 pm to NC_Tigah
quote:
Right.
What is the macroeconomic effect of large gas/oil price increases on US employment?
It suppresses production.
Thus it suppresses GDP.
Lower GDP isn't good for employment.
Increase the velocity of money with lower production and you become that mother fricker.
Look at Trump's first term, the price of oil, and the GDP/employment figures.
This is elementary stuff.
The key is to keep the economy growing.
Iran is a temporary blip. Eventually, we will be able to go gangbusters. Hopefully, the timing goes very well with election cycles.
Posted on 4/29/26 at 4:02 pm to meansonny
quote:
Rule#1 for monetary policy: Don't be stupid
You mean like being a Fed Chair and claiming inflation was transitory
I cant wait for Warsh to cut aggressively
Posted on 4/29/26 at 4:08 pm to Kreg Jennings
quote:Considering Powell's statement re FFRs, is that a surprise?
Additionally, the 2 year treasury rate is approximately 20 bps above the federal funds overnight lending rate…which is typically indicative of where the market thinks rates are going two years from now. Which is not lower. Actually, slightly higher.
In a normal/neutral policy environment, the 2-year tends to trade 0–50 bps above the fed funds rate, so 20 bps is fairly unremarkable and consistent with a steady-state outlook.
The problem is Powell's attribution of current ""inflation"" is to one-off tariff costs and war-related oil prices.
The Fed could raise rates to 10% and it would not impact those variables.
Yet THAT IS THE BASIS Powell cites for elevated rates.
Meanwhile, Powell cited declining employment with unemployment numbers being propped due to migrant outflow. He doesn't care! He continues to completely, totally, and ridiculously ignore GenZ unemployment rates, which are atrocious! Nor does he give a rat's arse about affects of FFRs on housing costs for that group.
The Fed has a dual mandate. Unfortunately, the Fed is interpreting that mandate as a weapon to duel Trump.
Posted on 4/29/26 at 4:14 pm to meansonny
quote:No kidding.
Lower GDP isn't good for employment
Neither is a hawkish Fed.
Posted on 4/29/26 at 4:15 pm to NC_Tigah
quote:
contractor miscues
I'm not in a position to know, and I've been involved on the higher side of multi-billion dollar projects, but I doubt the overruns are "Contractor miscues".
Posted on 4/29/26 at 5:09 pm to NC_Tigah
quote:
Unfortunately, the Fed is interpreting that mandate as a weapon to duel Trump.
I don’t see it that way. You do realize, just because data points to something other than Trump’s opinion…doesn’t mean it’s automatically some sort of personal affront.
That point of view when objective evidence points to something like this…that just so happens to not line up with Trump’s opinion…is sort of the opposite of TDS…yet the same mentality. Very victim-ish.
This post was edited on 4/29/26 at 5:22 pm
Posted on 4/29/26 at 5:16 pm to SDVTiger
quote:You mean like this?
You mean like being a Fed Chair and claiming inflation was transitory
LINK
quote:
Bessent: US should ‘wait and see’ before lowering interest rates
The Federal Reserve should “wait and see” before deciding whether to lower interest rates amid the war in Iran, US Treasury Secretary Scott Bessent said Monday at Semafor World Economy in Washington, DC.
“Do I think rates should be lowered? Eventually. I think now that we have to wait and see,” Bessent told Semafor Editor-in-Chief Ben Smith.
... “If ever there was ‘Team Transitory,’ it’s this,” Bessent said.
Posted on 4/29/26 at 5:26 pm to Kreg Jennings
quote:Has Trump stated anything I posted? J/c. Could you link it if he did?
something other than Trump’s opinion…
I'm not saying Trump doesn't hold similar opinions. I've just not heard him express it that way. You seem to want to simplify my arguments by attributing them as some sort of mindless parroting of Trump-speak. Parroting isn't my game. Understanding logical positions is.
The fact you "don’t see it that way" is not terribly important to me in this instance, because, so far, you've not indicated your vision on the topic is particularly good. But I am open-minded if you've more to bring to the table.
Posted on 4/29/26 at 5:32 pm to Timeoday
He won't do any time. Nothing is going to happen. Somebody had to approve the change orders and somebody else and somebody else had to sign off on them. The government is wasteful.
Posted on 4/29/26 at 5:33 pm to NC_Tigah
quote:
Has Trump stated anything I posted? J/c. Could you link it if he did?
You said “ Unfortunately, the Fed is interpreting that mandate as a weapon to duel Trump.”
And I’m stating that everything, or really anything the Fed does or has done, isn’t a personal jab at Trump.
In fact, they probably don’t (hopefully) think about how he or any other elected official might react / have an opinion about actions they take since they are charged with approaching important decisions like this with pragmatism based on both data and their experience.
Posted on 4/29/26 at 6:09 pm to Kreg Jennings
quote:Those are two VERY different premises. Let's separate them.
I’m stating that everything, or really anything the Fed does or has done, isn’t a personal jab at Trump.
quote:I agree 100%
I’m stating that everything the Fed does or has done, isn’t a personal jab at Trump.
quote:You're joking.
I’m stating that anything the Fed does or has done, isn’t a jab at Trump.
During T45, the Fed under Powell ramped up rates at a very rapid rate independent of inflation, by dependent on expected economic growth d/t Trump policies. Translation: Powell rode the brakes against T45 growth.
During Biden, there were 100's of inflation warning signs. As society PREDICTABLY returned to normal post-covid, and supply chains remained horribly disrupted because Biden players like Buttigeig were incompetent, ANYONE WITH A BRAIN could foresee coming inflation (Covid money prints vs limited goods). Yet, Powell & Co kept rates low for months until inflation was, of itself, economically crippling. Finally, the Fed stepped in to do its job.
Back came T47 with a far better economic acumen. More regulation cuts + tax cuts albeit with tariff increases which Powell first admitted were noninflationary. But then something changed. Suddenly, tariffs, which are inherently noninflationary, were instead labeled as "inflationary." Thus Fed rate hikes, rather than cuts, were indicated.
Now, a very naïve person might assume Powell & Co are just total dumbasses. But a less naïve person might consider the possibility of something a bid more 'knowing' aka nefarious.
Posted on 4/29/26 at 6:20 pm to udtiger
Posted on 4/29/26 at 7:05 pm to NC_Tigah
quote:
NC_Tigah
Out of curiosity…what do you do for a living?
Posted on 4/29/26 at 7:15 pm to Taxing Authority
Bessent is the Fed Chair?
The claim that Bessent is just repeating Powell’s 2021 mistake ignores the fundamental mechanical differences between the two eras: Powell’s "transitory" label failed because he misjudged a broad, systemic surge in wages, rent, and money supply that was already baked into the domestic economy.
In contrast, Bessent is looking at a classic external event-driven shock—where headline inflation is being spiked by the Iran conflict and $4 gas, but core inflation (the underlying prices that actually stick) is actually trending lower.
While Powell was hoping internal supply chain knots would untie themselves, Bessent is making a macro-investor’s bet that the "war noise" is temporary and that the resolution will provide a long-term "peace dividend."
Essentially, comparing the two is a false equivalence: Powell misread a permanent structural shift as a fluke, while Bessent is identifying a specific geopolitical fluke that he believes won't alter the long-term value of the dollar.
But you made an attempt so I will give yoi credit for that
The claim that Bessent is just repeating Powell’s 2021 mistake ignores the fundamental mechanical differences between the two eras: Powell’s "transitory" label failed because he misjudged a broad, systemic surge in wages, rent, and money supply that was already baked into the domestic economy.
In contrast, Bessent is looking at a classic external event-driven shock—where headline inflation is being spiked by the Iran conflict and $4 gas, but core inflation (the underlying prices that actually stick) is actually trending lower.
While Powell was hoping internal supply chain knots would untie themselves, Bessent is making a macro-investor’s bet that the "war noise" is temporary and that the resolution will provide a long-term "peace dividend."
Essentially, comparing the two is a false equivalence: Powell misread a permanent structural shift as a fluke, while Bessent is identifying a specific geopolitical fluke that he believes won't alter the long-term value of the dollar.
But you made an attempt so I will give yoi credit for that
Posted on 4/30/26 at 5:41 am to NC_Tigah
quote:
NC_Tigah
quote:
Out of curiosity…what do you do for a living?
Posted on 4/30/26 at 5:52 am to NC_Tigah
quote:
Back came T47 with a far better economic acumen. More regulation cuts + tax cuts albeit with tariff increases which Powell first admitted were noninflationary. But then something changed. Suddenly, tariffs, which are inherently noninflationary, were instead labeled as "inflationary." Thus Fed rate hikes, rather than cuts, were indicated.
The Fed hasn’t raised rates during Trump’s second term.
Posted on 4/30/26 at 6:35 am to Victor R Franko
It will be fascinating to learn the truth. Hopefully it exposes the real corruption that is the Federal Reserve.
Posted on 4/30/26 at 6:40 am to Timeoday
frick that hack. Forcibly physically remove him if necessary.
Posted on 4/30/26 at 2:18 pm to LSURussian
quote:
The FOMC voted 8-4 to leave rates unchanged. The Fed Chair only gets one vote.
Fed Chair is like a jury foreman. He carries a lot of wait in the final verdict.
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