The article discusses the implication of a scenario where President Trump might nominate an individual to undermine Powell at the Fed. This figure, referred to as X, could communicate intentions to lower interest rates, potentially influencing markets before any official changes occur. The piece highlights the complexity of internal Fed dynamics, with some traditionally conservative members shifting perspectives. If X garners support from other presidents like Waller and Bowman, a coordinated message on aggressive rate cuts could develop, offering guidance that might lead the Fed into actions irrespective of inflation trends.
Imagine a scenario where President Trump opts to nominate an individual to undercut Powell, engaging the media to send signals about future monetary policy shifts.
If this shadow Fed president gains support from conservative Fed presidents, we may see a push for aggressive rate cuts despite ongoing inflation concerns.
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