🚀 Trump vs. Fed: “Cut Rates or I’ll Force Action!” What’s Next for Markets?

🔥 The Showdown Escalates:

President Trump launched a blistering attack on Fed Chair Jerome Powell, branding him a “numbskull” for refusing to slash interest rates despite “great” inflation data. Trump demands a full 1% cut calling it “Rocket Fuel” for the economy and threatened: “I may have to force something” if the Fed doesn’t comply .

💸 Hidden Agenda? Debt Relief!

Trump claims a 2% rate cut would save the U.S. $600 billion/year in interest on national debt. But economists slam this as misguided: Treasury yields (set by markets) ≠ Fed rates . Truth: The Fed’s mandate is price stability, not deficit management.

⚔️ Behind the War:

1. “Mr. Too Late” vs. “Genius”: Trump mocks Powell’s caution as “monetary malpractice” , while VP JD Vance echoes: “The Fed’s refusal to cut is reckless!” .

2. Tariff Time Bomb: The Fed fears Trump’s trade policies could spike inflation to 3.5% by December (Goldman Sachs). May’s mild CPI (2.4%) is a calm before the storm as tariff impacts loom .

3. Political Pressure Peak: Trump admits he won’t fire Powell (“I don’t know why it’d be so bad…”), but will replace him in 2026.

📉 Fed’s Unshakeable Stance:

No cuts until September? Markets price a 76% chance for a Sept cut – but near-zero odds for June/July.

Why wait? Powell needs proof tariffs won’t cause persistent inflation. NY Fed reports already show firms passing tariff costs to consumers.

Risk of rushing: Cutting too soon could reignite inflation, forcing harsher hikes later.

💎 Crypto & Market Impact:

Dollar dominance at risk? Trump warns high rates hurt USD competitiveness vs. Europe’s 10 cuts.

Crypto hedge: If tariffs fuel inflation, Bitcoin could surge as a safe haven. Watch for Fed policy errors!

Borrowing pain: Credit cards at 28.67% (vs. 14.6% in 2021) and mortgages near 6.9% squeeze consumers.

🔮 Predictions & Explosive Scenarios:

✅ Sept 2024 Rate Cut: Likely if summer inflation stays tame (current odds: 76%) .

❌ Stagflation Threat: Tariffs + premature cuts could = higher inflation + recession by 2026.

💥 Trump’s “Forced” Action: If elected, expect a dovish Fed Chair pick in 2026 or executive orders challenging Fed independence.

#TrumpTariffs

⚠️ Final Warning: This isn’t just politics it’s a battle for control over $24 trillion in U.S. debt. The Fed’s next move could make or break markets. Stay alert, stack wisely.

(Sources: MrXLove 🧠👈👉👽, Reuters, CNBC, Forbes, NY Post & lil More 👀😅)