The Powell Rumor
It's a big deal, if it happens...
Heard the whispers about Powell?
The rumor is he’s considering stepping down.
Obviously they are trying to find an excuse to pressure him into an uncomfortable position to force him to resign.
More context:
Why should you care?
Because it’s a HUGE deal.
Ok, let’s get real for a second:
Imagine Powell resigns.
The new person in charge cuts rates meeting after meeting.
What happens next?
The economy overheats
Inflation roars back (4% core CPI or more)
The new (puppet) FED chair is then NOT willing to hike rates enough.
The US is left with 4% inflation, and 1% interest rate.
This creates a deeply negative real yield.
It’s a financial term to say:
“Your cash loses value, A LOT.”
And this is the kind of scenarios where a hard asset like GOLD shines.
The Dollar would be hit hard.
And assets like precious metals and crypto would attract a lot of inflows.
In other words…
If anything happens to Powell:
The precious metal will hit 3500 fairly quickly.
So we can add that to the list of reasons for being long:
With that said…
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The overall sentiment from your summary (and I agree) is that Powell leaving will be bearish for USD because policies from the new fed chair (especially if opposite that of Powell) will be seen as political motivated. But for curiosity sake, with the CPi numbers, do you think they'd report the real number if inflation roars back as you put? I ask because in the past the job numbers were cooked up when convenient to pump USD and revised after a month or two when attention had been diverted.