My Kingdom for a Fed Rate Cut NOW

Letter to Ephesians: Unlike its Euro counterparts, the Fed again left its interest rate unchanged as it “waits out the tariff economy.” Considering the Fed cut rates for Biden as if a steak, is it more likely the Fed playing politics? Or is it an admission its economic gurus are just stumped?

If you believe Fed Chairman Powell, it’s the latter. At least, so surmised the WSJ: “Powell’s balancing act projected confidence,” the story went, “while admitting ‘we don’t know’ what comes next.” That sounds clear as mud. But, the political cover story per the WSJ goes like this: “The Fed is trying to see how the dust will settle from the aftereffects of President Trump’s April 2 ‘Liberation Day’ tariff announcements.” Yet, wasn’t that over two and a half months ago and inflation hasn’t soared as the fearmongers have insisted? We’re told, “The Fed officials still don’t feel as if they completely vanquished inflation after a 3-year-long fight.” But, to dampen the critics, we’re also to believe the Fed is still “penciling in two rate cuts this year.” When? In December as a Christmas gift?

Could it be the Fed doesn’t have as much influence over inflation let alone the economy as it’d like to think and was most honest when conceding as much by the chairman’s “we don’t know” remark? And, if so, would it kill Powell (or the economy), to try a measly quarter point rate cut NOW, as Trump is begging & as the Euros have done, only even more generously? Or, does it not matter much what the Fed does after all?

Davd Soul