The Federal Reserve' s Shadow Government

Powell’s shadow Fed majority could threaten jobs, housing and growth

Jay Powell lost the chairmanship. He may still control the reaction function

PETER NAVARRO: Kevin Warsh has now been sworn in as the new Federal Reserve chair. Outgoing Chair Jerome Powell has refused to leave the Fed Board of Governors, breaking with the modern custom that departing Fed chairs leave the Board rather than linger as rival power centers.

The clear danger: Powell will have enough board support to act as Fed shadow chair and force a series of rate hikes down Warsh’s throat.

Never mind that even a single rate hike would be the worst possible response to an oil-price shock. Never mind that two of Jay Powell’s predecessors understood the difference between demand inflation and an oil shock.

When Iraq invaded Kuwait in 1990, Alan Greenspan understood that an oil shock can both raise headline inflation and damage growth. His FOMC repeatedly cut the federal-funds rate as the economy weakened.

When oil, foodstuffs, fertilizers and industrial metals all moved sharply higher in 2008 — driven by booming emerging-market demand, constrained supply, thin spare capacity and speculative flows — Ben Bernanke’s Fed likewise cut the federal-funds rate in April. He then held steady in June and refused to launch a recessionary rate-hike campaign into prices the Fed could not drill, refine, mine, plant or ship away.

That is the looming central error. The Fed cannot produce one extra barrel of oil. It cannot reopen a shipping lane. It cannot refine gasoline. It cannot lower diesel costs by crushing mortgage demand in Ohio or forcing a small manufacturer in Pennsylvania to roll over credit at punitive rates.

A Fed rate hike now would rein in demand in response to a supply shock and hit precisely where the economy is already vulnerable. Housing would weaken further. Interest-sensitive manufacturing would suffer.

Small-business credit would tighten. Financial conditions would tighten just as energy prices are eating real incomes. The dollar could strengthen, pressuring exporters.

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"Too Late" Jerome Powell should leave at end of Fed Term

Jerome Powell Doubles Down On Past Rate Mistakes

By Peter Navarro
March 19, 2026

In holding rates steady, Jerome Powell—the worst Fed Chair since Arthur Burns—has once again let his anti-Trump animus cloud his judgment. The damage will not show up only on Wall Street.

It will show up in the monthly payment on a starter home, the financing costs of a machine-tool purchase, the builder who delays a project, the manufacturer who shelves an expansion, and the family that watches its credit costs stay painfully high while the Powell Fed congratulates itself for being “disciplined.”

This is not just a spiteful and damaging policy mistake. It is a fundamental misreading of the economy.

Powell continues to act as if inflation is broad-based, demand-driven, and on the verge of reaccelerating. Powell has clearly signaled his intention to remain on the Board of Governors even after his term as Chair expires.

This is nothing more than a Powell extortion expedition for a “plea deal”—having possibly acted above the law, he is trying to evade any possible accountability by conditioning his departure on the Department of Justice dropping its probe of Powell.

Read the article by Peter Navarro

Senator Thom Tillis, an obstacle

Trump nominates Kevin Warsh to lead the Federal Reserve

President Donald Trump has officially nominated Kevin Warsh to serve as the next chairman of the Federal Reserve, sending the nomination to the Senate on Wednesday. The move came more than a month after Trump first publicly announced he wanted Warsh to head the central bank.

If confirmed, Warsh would replace current Fed Chair Jerome Powell and serve a four-year term.

The nomination, however, faces an unusual obstacle, and it isn't coming from Democrats.

Sen. Thom Tillis, R-N.C., has said he will block Warsh's nomination from advancing in the Senate until a federal criminal investigation of Powell by the Washington, D.C. U.S. Attorney's Office is shelved. That threat could prevent the nomination from reaching the Senate floor entirely.

According to Newsmax, the investigation centers on the $2.5 billion renovation of the Federal Reserve's headquarters in Washington and Powell's Senate testimony about the project. Powell disclosed in mid-January that he was under investigation in connection with the matter.

A $2.5 billion headquarters renovation for an institution that prints the money it spends. That alone tells you something about the culture inside the Fed.

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Jerome

Powell refuses to cut rates even though inflation fell to 2.7% and Trump's policies are working

Trump Called Fed Chair Jerome Powell This One Name Amid Criminal Investigation

Trump took the stage at the Detroit Economic Club on Tuesday and said what millions of Americans have been thinking about Federal Reserve Chairman Jerome Powell.

"We have a real stiff in the Fed," Trump told the crowd. "If I had the help of the Fed, it would be easier. But that jerk will be gone soon."

The audience knew exactly who Trump meant.

Powell's been dragging his feet on rate cuts while the economy is primed to explode.

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Jerome Powell

 

Jerome Powell and the Fed lowered interest rate by 0.25%

Fed lowers interest rates by 0.25 percentage points in first cut since 2024

The Federal Reserve on Wednesday lowered its benchmark interest rate by 0.25 percentage points — its first cut since December — as the U.S. grapples with a stalling labor market and slower economic growth.

The Fed cut reduces the federal funds rate — what banks charge each other for short-term loans — to between 4% and 4.25%, down from its prior range of 4.25% to 4.5%. The last time the central bank eased borrowing costs was in December 2024, when it also trimmed rates by a quarter of a percentage point.

Federal Reserve officials are also penciling in two more rate cuts in 2025, but only one in 2026, according to the central bank's summary of economic projections. That may disappoint Wall Street, with investors before the meeting projecting a total of five cuts over the rest of the year and 2026.

Only one member voted against...he wanted a rate cut of 0.50.

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An Appointee of Biden on the Federal Reserve has dendered her resignation

Fed Governor Announces Resignation, Opening Vacancy on Interest Rate-Setting Committee

"Adriana Kugler did not cite a reason but said she would return to her teaching position at Georgetown University in the fall.

The Federal Reserve has announced that Fed Governor Adriana Kugler is resigning early from her term and will exit the central bank on Aug. 8, creating a vacancy on the central bank’s 12-member interest rate setting committee that President Donald Trump will have an opportunity to fill.

Kugler, an appointee of President Joe Biden whose term was set to expire in January 2026, announced her departure in an Aug. 1 letter to Trump, saying she would return to her teaching post at Georgetown University this fall. She did not give a reason for her resignation.

“It has been an honor of a lifetime to serve on the Board of Governors of the Federal Reserve System,” Kugler wrote. “I am especially honored to have served during a critical time in achieving our dual mandate of bringing down prices and keeping a strong and resilient labor market.”

Her exit comes after the Fed voted this week to keep interest rates unchanged, a decision opposed by two Trump appointees, Christopher Waller and Michelle Bowman, who argued for a quarter-point rate cut.

Kugler did not participate in the vote. In recent months, she had voiced support for holding rates steady until the effects of Trump’s new tariffs on inflation became clearer—a stance generally viewed as hawkish."

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The Federal Reserve Board of Governors has seven members. These governors are nominated by the President of the United States and confirmed by the Senate. They serve 14-year terms, with one term beginning every two years. The Board also includes a Chair and a Vice Chair, who are appointed by the President from among the sitting governors and serve four-year terms, according to the Federal Reserve Board.

Jerome Powell is determined to finish his Term

Federal Reserve chair Jerome Powell declines to step down

Hold onto your wallets, folks -- Federal Reserve Chairman Jerome Powell is digging in his heels despite a storm of pressure from the White House to pack his bags, as the Daily Caller reports.

Reports surfaced on Friday from CNN (Fake News regarding Trump...can anyone believe what CNN says?)  that Powell is standing firm against calls from President Donald Trump for him to resign. Several Republicans want him to resign over his reluctance to cut interest rates, with the Fed chair quietly assuring close allies he plans to serve until his term ends in May 2026.

This saga kicked off in recent months as Trump and other GOP figures ramped up their criticism of Powell’s monetary policy decisions. They argue that slashing rates could spur economic growth, but Powell isn’t budging. It’s a classic standoff between political demands and central bank independence.

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Trump has said that firing Powell is not necessary...he should just cut interest rates. So, Trump has not pressured Jerome Powell to resign although many Reublicans have suggested that.

The president said Tuesday he doesn’t think Powell should resign before his term is up in May but bashed him for not lowering interest rates.

Day at the Federal Reserve

Jerome

Jerome Powell's Political Games

Jerome Powell just made one admission about Trump’s tariffs that has the President seeing red

Powell drops bombshell confession at Portugal conference

Jerome Powell has been a thorn in Donald Trump’s side since day one.

The Federal Reserve Chair keeps finding new ways to sabotage Trump’s economic agenda.

And Jerome Powell just made one admission about Trump’s tariffs that has the President seeing red. Federal Reserve Chair Jerome Powell traveled all the way to Portugal to deliver what might be the most tone-deaf comments of his entire career.

Speaking at a financial conference on Tuesday, Powell essentially admitted he’s been holding the American economy hostage over President Trump’s tariff policies.

The confession came when Powell was asked directly whether the Fed would have cut interest rates more aggressively if not for Trump’s tariffs.

"So I do think that—I think that’s right," Powell responded. "We’re in effect—we went on hold when we saw the size of the tariffs, and essentially all inflation forecasts for the United States went up materially as a consequence of the tariffs."

Instead of following the economic data, Powell has been making political calculations about Trump’s trade policies.

Current Annual inflation for the 12 months ending in May 2025 is 2.35%. Interest is at 4.5%

Read about Jerome

Jerome Powell

Jerome Powell: The Grand Speculator

Excerpt from Breitbart Business: "The Fed chair once warned against using speculative forecasts to drive policy. Now he’s doing exactly that.

Federal Reserve Chair Jerome Powell made a quiet but extraordinary admission on Tuesday: if the Fed were following the actual data, it would be cutting interest rates. But it isn’t—because the Fed expects President Trump’s tariffs to raise inflation, and it's choosing to act on that forecast instead.

“If you just look at the basic data and don't look at the forecast, you would say that we would've continued cutting,” Powell told lawmakers. “The difference, of course, is at this time all forecasters are expecting pretty soon that some significant inflation will show up from tariffs. And we can't just ignore that.”

That’s a remarkable departure from the Fed’s longstanding mantra of data-dependence. It also reveals the extent to which the central bank is allowing anti-tariff bias—and speculative inflation models—to override clear economic signals pointing toward looser policy.

The data are, in Powell’s own words, favorable to a resumption of rate cuts. Inflation has come down meaningfully. We don't yet have the personal consumption expenditure index reading for May, but Harvard economist Jason Furman's calculation based on CPI is that the three-month annualized rate is around 0.6 percent for headline inflation and 1.4 percent for annualized inflation. The year-over-year figure is two percent for headline, exactly at the Fed's target, and 2.5 percent for core inflation.

Yet Powell is blocking further cuts because of what inflation might do, not what it’s doing. Specifically, he and his colleagues fear that Trump’s April 2 “Liberation Day” tariff announcement will eventually lift consumer prices—even though so far, that impact is not visible in the data. 

The next Fed meeting is in late July. Between now and then, the Fed will only get one more month of inflation data with the May PCE inflation and the June CPI and PPI. It seems highly unlikely that if Powell is not ready to cut based on the last four or five months of data, including at least two months of post-Liberation Day inflation reports, one more month is not going to move the chains."

President Trump calls him a "Total and Complete Moron" for leaving interest rates steady.

Will the Federal Reserve Lower interest Rates?

Trump Drops a Truth on Powell

"Federal Reserve Chairman Jerome Powell is the latest target of a Donald Trump “Truth Bomb” barrage on his Truth Social platform.

Powell had delivered a speech at the Economic Club of Chicago the day before in which he was not overly enthusiastic about the president’s Liberation Day tariff strategy. Powell suggested that he had a dilemma: try to tame inflation or increase growth in the economy.

To that, President Trump said, so what? (So to speak.)

The president has been a skeptic of Powell for some time, and the world was reminded of that today when Trump unleashed this blistering Truth post:

The ECB [European Central Bank] is expected to cut interest rates for the 7th time, and yet, “Too Late” Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete “mess!” Oil prices are down, groceries (even eggs!) are down, and the USA is getting RICH ON TARIFFS. Too Late should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough!

So, Trump wants rate cuts now or perhaps he’ll fire Powell. So, the question becomes, would Trump actually do it? Powell is basically a lame duck. His term ends the summer of 2026."

Read Breitbart

It wasn't Putin, Joe!

Federal Reserve chairman needs just one sentence to dismantle Biden's narrative on inflation crisis

Federal Reserve Chairman Jerome Powell contradicted President Joe Biden on Wednesday, explaining the ongoing inflation crisis is not being driven primarily by Russian President Vladimir Putin.

As recently as Monday, the Biden administration called the Ukraine war "the biggest single driver of inflation."

Can anyone trust President Biden? Anyone?

What exactly did Jerome Powell say?

Factors pushing Inflation per Jerome Powell

Fed Chair Powell Finds New Scapegoat to Blame

As every other mistaken justification for the ‘great resignation’ and stagnant job growth with spiraling inflation have collapsed to nothingness, like a gift from Fauci the frightening new “Omicron” variant of COVID19 came.

And the renewed panic built by governments and the media alike has provided a new scapegoat for the sheer unwillingness of many Americans to return to work as long as Democrat-Socialists continue to hurl free money at them. He even tangentially tied supply-chain disruptions and inflation in for good measure!

Read what Federal Reserve Chairman Jerome Powell said