This weekend alone, we noticed the administration threatening to carry felony expenses in opposition to the chair of the Federal Reserve, and we edged nearer to a army battle with a NATO nation. These weren’t the one large and worrying developments over the previous few days, nor was the week being ended by any stretch of the creativeness quiet.
This isn’t to say that the market hasn’t reacted to unhealthy information beforehand throughout the present administration. There have actually been instances the place a disastrous coverage announcement has triggered issues to drop, however at all times with outstanding pace, traders have reverted again to the “that is tremendous” mode, even when the issue they have been reacting to has in no way gone away.
We’ll see how issues play out over the subsequent few days, if Trump once more backs down once more (which might be considerably tough now that the wheels are in movement) and whether or not or not the markets resolve that is lastly a time for a flight to security and the bond vigilantes truly get critical.
POWELL: “The specter of felony expenses is a consequence of the Federal Reserve setting rates of interest based mostly on our greatest evaluation of what’s going to serve the general public, fairly than following the preferences of the President.”
youtu.be/KckGHaBLSn4
— Carl Quintanilla (@carlquintanilla.bsky.social) January 11, 2026 at 5:01 PM
Tillis is spot on. The Senate cannot verify a Trump toady to succeed Powell on the Fed. The remainder of the sport is now out within the open, and it would not finish properly.
— Justin Wolfers (@justinwolfers.bsky.social) January 11, 2026 at 6:00 PM
What can historical past educate us about what occurs when a populist strongman with an idiosyncratic style for low rates of interest undermines central financial institution independence?
— Justin Wolfers (@justinwolfers.bsky.social) January 11, 2026 at 5:44 PM
