Jerome Powell (5:10)

For a long time we've been working on the hypothesis really that tariffs would lead to a one time price increase and that that would go away over time. In other words, there would be no further change. So measured inflation wouldn't reflect that higher level going up more and more. And it's time for that to happen. You know, we really do expect that to be happening in the next two quarters. So we'll be watching very carefully to see that what we've thought all along would happen. That's kind of critical part of the forecast. We need to really see that with, with energy. It's, it's so hard to say. I mentioned, you know, in, you know, sort of the textbook, you, you would look through it an oil shock because they tend to be short lived and they tend to revert and monetary policy works with long and variable lags. So, you know, you wouldn't necessarily react right away. I think that is all the more true given that we're several years above 2% inflation and that we're already looking through the tariff shock. So I think we're going to be very cautious about that. But the question about looking through energy really is not in front of us right now. It hasn't even peaked yet. And I think we'd want to see the backside of that end progress on tariffs before we even thought about reducing rates.

Ron Filipkowski (6:25)

So if I could follow up more from Jerome Powell here who says that he's got deep concerns regarding the independence of the Fed that are unprecedented in the history of the Federal Reserve. Play this clip.

Reporter/Interviewer (6:37)

Thank you, Mr. Chair. Appreciate the kind words about the press often doesn't come from the podium in different places. But appreciate that. Can you talk about what has gone into your decision to remain on the board? What kind of criteria are you weighing and how long might you stay? Thank you, Chair Powell.

Ron Filipkowski (6:52)

Sure.

Jerome Powell (6:53)

So, you know, my concern is really about the series of legal attacks on the Fed which threaten our ability to conduct monetary policy without considering political factors. And I want to note here this has nothing whatever to do with verbal criticism by elected officials. I've never suggested that such verbal criticism is a problem and neither has anyone else here. But these legal actions by the administration are unprecedented in our 113 year history and there are ongoing threats of additional such actions. I worry that these attacks are battering the institution and putting at risk the thing that really matters to the public, which is the ability to conduct monetary policy without taking into consideration political factors. It is so important for our economy, for the people that we serve, that they can depend over time on a central bank that operates that way free of political influence. It's part of the absolute foundation of this amazing economy that we have. It's just one of the many reasons why the US Economy is the envy of the world. That piece of institutional architecture separates successful countries from unsuccessful countries. It is extremely important not for the people who work at the Fed at any given time, but for the people that we serve, that the Fed remain able to conduct monetary policy in a way that doesn't get pulled into politics trying to help or hurt any particular politician or political party. It's critical for the people that we serve in terms of when I would leave, I will leave when I think it's appropriate to do so. Was that all your questions or was that.

Ron Filipkowski (8:23)

Well, I just have then Chairman Powell talks about the real catastrophic inflation situation we're in now because of Donald Trump and his regime.

Jerome Powell (8:31)

Here, play this clip Inflation has moved up recently and is elevated relative to our 2% longer run goal. Estimates based on the Consumer Price Index and other data indicate that total PCE prices rose 3.5% over the 12 months ending in March, boosted by the significant rise in global oil prices that has resulted from the conflict in the Middle East. Excluding the volatile food and energy categories, core PCE prices rose 3.2% over the 12 months ending in March. This relatively high rate largely reflects the effects of tariffs on prices in the goods sector. Near term measures of inflation expectations have risen this year, likely because of the substantial rise in oil prices.

Ron Filipkowski (9:17)

Powell further talks about how inflation has moved up. Let's play this clip.

Jerome Powell (9:21)

Inflation has moved up and is elevated, in part reflecting the recent increase in global energy prices. Today, the FOMC decided to leave our policy rate unchanged. We see the current stance of monetary policy as appropriate to promote progress toward our maximum employment and 2% inflation goals. Developments in the Middle east are contributing to a high level of uncertainty about the economic outlook, and we will remain attentive to risks to both sides of our dual mandate.

Ron Filipkowski (9:51)

And he talks about how there's been a slowdown in job growth. One major driver is Trump's attack on immigrants. That's a major part of the labor force, but another major part is just stagnant job growth in general. Trump is a loser when it comes to jobs.

Jerome Powell (10:09)

Here, play this clip A good part of the slowing in the pace of the job growth over the past year reflects a decline in the growth of the labor force due to lower immigration and labor force participation, though labor demand has clearly softened as well. Other indicators, including Job openings, layoffs, hiring and nominal wage growth generally show little change in recent months.

Ron Filipkowski (10:32)

And I've long said this, folks, we are in a jobs recession right now. You don't need to hear it from me. You know, we're in a jobs recession right now. What are we talking about? Manufacturing jobs across the board. Jobs. Trump hasn't created any new jobs. You remember, under former President Biden, we're on a month to month basis, It'd be like 300,000 new jobs were created, 200,000 new jobs, 400,000 new jobs. Regardless of the later adjustments, massive jobs were created. The most in American history, the most jobs in American history under any presidency. Objectively, they were created under former President Biden. Then Donald Trump's like, I'm gonna do it better, I'm gonna do it better. Just give me two weeks. And then Donald Trump not only made it worse, but just like Trump's first term where he was a job losing president, oops, he did it again. Cuz he's a lifelong loser who bankrupts things. More on Jerome Powell right here. Who said that he's not leaving the board? The Federal Reserve Board. Play this clip.

Jerome Powell (11:27)

I welcomed the announcement last Friday by the U.S. attorney for the District of Columbia that she had closed the criminal investigation. She also noted, however, that she would not hesitate to restart the investigation. Over the weekend, the Department of Justice provided assurances that they will not reopen the investigation unless there's a criminal referral from the Fed's inspector general. And absent such a referral, if they do appeal the recent court decision, they would not seek as part of that appeal to restart the investigation or send new subpoenas. I've said that I will not leave the board until this investigation is well and truly over with transparency and finality. And I stand by that. I'm encouraged by recent developments and I'm watching the remaining steps in this process carefully. My decisions on these matters will continue to be guided entirely by what I believe is in the best interest of the institution and the people we serve. After my term as Chair ends on May 15, I will continue to serve as a governor for a period of time to be determined. I plan to keep a low profile as a governor. There's only ever one chair of the Federal Reserve Board. When Kevin Warsh is confirmed and sworn in, he will be that chair. Once sworn in as board chair, his new colleagues will elect him to chair the FOMC as well.

Ron Filipkowski (12:48)

And he's like, let me be clear, I'm literally staying because of the actions being taken against me and the Federal Reserve in general. He goes, I was planning on retiring, but because of these actions, that's what inspired me to stay. Cuz I feel that I have an obligation to protect the independence of this thing. So I'm gonna make a sacrifice and stay on here. Let's play this clip.

Reporter/Interviewer (13:11)

What would you say to the criticism that by remaining on the board you're actually taking a political act and denying President Trump the majority of the board, which as president he would have. If you.

Jerome Powell (13:23)

I don't see that at all. As I mentioned, you know, I'm literally staying because of the actions that have been taken. I had long planned to be retiring and you know, the things that have happened in really in the last three months have I think left me no choice but to stay until they're, until I see them through at least that long. You know, in addition, I don't see how this will interfere. My intention is not to interfere. You know.

Ron Filipkowski (13:48)

And folks, you know, the price at the gas right now is atrocious. The average price for a gallon of gas in the US is now rising to $4.23 a gallon. I mean out here in California it's like six bucks. It's the highest since 2022. Nationally right now, Brent crude oil prices officially surged their highest level of the Iran war and $119.50 per barrel. So in the entire war right now, the entire thing, we're at $119 and 50 cents. And this comes as Donald Trump also was like, I love the blockade. Genius. We're just going to do blockade forever. This puts Brent crude oil prices at their highest level since 2022. The IEA has called this the biggest energy security threat in history. And as I noted before, the Fed is no longer expected to do any interest rate cuts in 2026. And if Donald Trump just did freaking nothing. If he did nothing, he just let Biden's economy go on overdrive. It's why I say my little daughter he met, it would have done a better job than Donald Trump because she would have just listened to Elmo and AB Day and it wouldn't have to be all of the moves that hurt. Seriously, my 18 month old would do better than Donald Trump in the presidency because she'd just be watching Elmo and Ms. Rachel. But Donald Trump screwed it all up. All of his moves. Now we can't do rate cuts. Now we're losing jobs. Now we're back in inflation where everything was moving in the right direction. While all of that's taking place. Donald Trump was in the Oval Office saying, I love the blockade. Genius. The blockade is a genius. Listen to what he said. Here, play this clip.

Donald Trump (15:24)

Well, the blockade is genius. Okay? The blockade has been 100% foolproof. It shows how good our Navy is. I can tell you that. Nobody's going to play games. We have the greatest military in the world and I built much of it during my first term and we've been building it since. And the greatest anywhere in the world. Nobody even close. And. And you see that every, whether it's Venezuela, which, and they have a good military in Venezuela. But it was over in one day. It was actually over in about 48 minutes. Iran, the same thing. I mean, militarily, we've wiped them out. They have no military left. It's all the Navy's at the bottom of the sea. The Air Force is never going to fly again. We've got an amazing military now. They have to cry uncle. That's all they have to do. Just say we give up. We give up.

Ron Filipkowski (16:17)

So utterly despicable. Let me know what you think. Hit subscribe. Let's get to 7 million subscribers. You may think you're subscribed, but you may not actually be subscribed. So double CH check help us hit 7 million subscribers. Thanks for watching. Y' all want to stay plugged in? Become a subscriber to our substack@midasplus.com you'll get daily recaps from Ron Filipkowski ad free episodes of our podcast and more exclusive content only available@midasplus.com

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