Powell's Endgame: Rate Cuts, Legacies, and Leaving the Table Clean

Powell's Last Hand: Playing It Safe?

Alright folks Axe here. Word on the street—or rather from some guy named Nicholas Colas at DataTrek—is that Jay Powell ain't about to start throwing rate cuts around like confetti at a kid's birthday party. Seems our boy's got 'legacy' on the brain. You know the kind of legacy where you don't screw things up right before you leave the room. He's got eight FOMC meetings left including this week’s and apparently history suggests these Fed chairs get all tight fisted in their final act. Makes sense. You don't wanna be remembered as the guy who lit the fuse on the next financial bonfire.

Hawks Doves and the Fed's Final Flight

Colas says the last three chairmen Greenspan Bernanke and Yellen all ended on a 'hawkish' note. Color me surprised. These guys are supposed to be the adults in the room not some bunch of day traders chasing the next pump and dump. Powell is clearly trying to leave with his reputation intact. Good for him. Though let’s be real if I were him I'd be more concerned with what history books (and maybe a Scorsese film) will say about my political independence. You either die a hero or you live long enough to see yourself become the villain. So the question is what role is Powell choosing?

Market Moves: Reading the Tea Leaves (and Fed Statements)

The market's whispering that the Fed's gonna be slow on the trigger this year. Maybe one *maybe* two quarter point cuts by the end of 2025 they say. Personally I think that is a naive view. Someone needs to teach those guys about the art of war. Uncertainty around Trump's tariff policies is another fly in the ointment. Even if the data's pointing south Powell's gonna be sweating bullets about making a wrong move. I understand that. When you are in the business of trust you don't want to be wrong even if it is the right thing to do.

The Upside of a Tight Fisted Fed?

Here's the kicker: a hawkish Fed *might* not be the end of the world. Colas says the S&P 500 has actually rallied by an average of 16% in the final year of the last three Fed chair tenures. Go figure. I have to admit the devil I know is better than the one I don't. The market likes stability even if it is the stability of stagnation. Investors get that these guys are worried about their legacy. What they don't get is that legacy doesn't pay the bills. Fortunately I'm not one of them. Axe I'm about creating new paths.

Decoding Powell: Listen to What He Doesn't Say

Powell's got a tightrope walk ahead of him. He’s balancing inflation economic growth political pressure and his own damn legacy. So pay attention to what he *doesn't* say on Wednesday. That's where the real action is. Like Sun Tzu said "Let your plans be dark and impenetrable as night and when you move fall like a thunderbolt." I’m not sure Powell's got that kind of thunder in him but he's definitely thinking about his place in history. And that's a dangerous thing. Sometimes the best move is no move at all. Then again if you are not moving forward you are falling behind.

Axe's Take: Always Bet on Chaos

Me? I'm betting on volatility. Always. Powell's playing it safe the market's playing it cautiously and I'm playing to win. Because at the end of the day money isn't the goal. It's the scoreboard. So let's see what Powell does. I am ready to get in the game. Because like I always say what is the point of having fuck you money if you never say fuck you? Stay frosty folks.