Stocks are rallying, the deficit is rising, and everyone wants cuts. Just another day at the Fed.
KEY TAKEAWAYS
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Interest rates affect stocks through borrowing costs, valuation math, and macroeconomic impacts
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Present value math makes rate hikes reduce stock values—even if nothing else changes
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The Fed’s dual mandate is jobs and price stability—not helping Treasury with deficits
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Kugler’s resignation opens a path for Trump to appoint a dove and shift the FOMC balance
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Doves and hawks can change—Powell, Waller, Kashkari have all evolved
MY HOT TAKES
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Wall Street’s obsession with the Fed is emotional, not just mathematical
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Kugler’s resignation could be a big deal—but not a guaranteed game-changer
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The President wants cuts for fiscal, not monetary reasons
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Dovish Fed members are political tools—until they’re not
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Markets are still addicted to rate cuts—despite not fully understanding why
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You can quote me: “No company–no matter how sexy or shiny–can do well if the economy is contracting.”