That photo of the white hard hat may be written into financial history.
This is today's most sensational news—Trump, wearing a white hard hat, inspects the Federal Reserve headquarters.
First, the timing of the inspection is very particular: 'Thursday, 4:00 AM Beijing time'.
· Thursday: This is the time when the Federal Reserve announces its interest rate decisions; the next announcement will be 'next Thursday'. What Trump wants to express is self-evident.
· 4:00 AM: Coincidentally, it was the time of the U.S. stock market closing, and Trump did not want this inspection to affect the market.
Second, Trump and Powell quarreled on the spot.
Trump criticized the renovation costs of the Federal Reserve headquarters in front of reporters—$2.5 billion (later revised to $3.1 billion). After hearing this, Powell couldn't help but shake his head in rebuttal, stating that this figure was inaccurate. Trump pulled out a piece of paper from his suit jacket and handed it to Powell. Powell put on his glasses to study it carefully and then corrected the president. 'Sir, you just added a third building,' Powell said.
Trump and several advisors expressed that they hoped Powell would resign and that the Federal Reserve would cut rates at next week's meeting.
Third, the 'New Federal Reserve Communication Agency' openly criticized that the president's rare visit to the Federal Reserve reflects the typical showmanship style in Trump's governance strategy. This unusual moment is a political spectacle aimed at increasing pressure on the central bank—part of a non-conventional act that undermines Powell's public image and pushes for lower interest rates.
Trump said during his speech outside the construction site that his meeting with Powell had 'no tense atmosphere' and they had a 'fruitful' dialogue on interest rate cuts.
Interestingly, traders lowered their bets on the Federal Reserve cutting interest rates that day, believing there would be fewer than two rate cuts this year (as the two argued, traders had already begun to reprice the probability of rate cuts)—it seemed like the Federal Reserve was declaring war on Trump.
The image at the beginning of this article seems absurd, but it actually rehearses the script for a dramatic market change next week—July 31st's Federal Reserve meeting and August 1st's tariff deadline from Trump, two major shockwaves overlapping, the market is about to face an ultimate showdown.