Cleveland Fed President Harker's comments this Thursday about 'the earliest possible rate cut in June' triggered a market rally that day.

1. 'New Federal Reserve Correspondent' Nick Timiraos posted on X platform stating that the external interpretation of Harker's views has been misread.

· First, Harker wants to convey the notion that 'this is not a timid Federal Reserve'; if necessary, the Fed can act swiftly (June is a 'reference' rather than 'specific');

· Second, Harker has repeatedly responded with 'if': 'If we have clear and convincing data by June, then the Federal Reserve will take action.'

The above content was not published as an article, but rather informally released on his X account—indicating the Fed's fear of adverse market effects.

2. The Federal Reserve's urgency to clarify stems from fears of deepening market doubts about its 'loss of independence.' Before the U.S. stock market opened on Friday, there was a trend of 'dollar rising, everything falling,' seemingly in response to the Fed. The Fed loosened its stance on interest rate cuts, and after careful consideration, the market shifted to believe the Fed had lost its independence. Once the market perceives that the Fed has lost its independence, monetary policy will become ineffective, inevitably leading to unchecked inflation and financial disorder.

3. Kevin Warsh, a former Fed governor viewed as a potential successor for the Fed Chair, harshly criticized the Fed. He stated that the current predicament of the Fed is largely self-inflicted. The Fed failed to keep inflation low and instead focused on placating politicians by addressing issues like climate change, which has significantly threatened its independence.

The next Federal Reserve Chair must increase criticism of Powell and express extreme dissatisfaction with the current policies (preferring rate cuts) to gain Trump's favor (and nomination). Trump is looking for a Federal Reserve Chair who will obey him, which could potentially lead to a larger crisis.

The Federal Reserve has reached its most dangerous moment.