The Wyoming Standoff

INTERNAL MEMO
From: The Desk of Institutional Sanity
To: Anyone Still Pretending Central Banking Is Independent
Re: Jackson Hole 2025 — The Theater of the Damned

The ritual has begun. Powell and his merry band of central bankers have descended upon Jackson Hole for their annual three-day symposium, themed this year around "Labor Markets in Transition" — which sounds about as thrilling as watching paint dry in a Wyoming blizzard.

But let's cut through the academic veneer, shall we? Powell is walking into what could be his most consequential speech yet, and the pressure cooker is about to blow. Trump has been unleashing a full-scale assault on the Fed, demanding lower rates with all the subtlety of a sledgehammer to a Swiss watch. The President who once suggested he might fire Powell (whose term conveniently expires next May) is now treating monetary policy like a Twitter poll.

Meanwhile, the dollar has been climbing all week as traders position themselves like poker players with sweaty palms, waiting for Powell's Friday address. Every basis point of expectation is getting priced, repriced, and priced again.

Here's the beautiful irony: markets closed Wednesday with the S&P down 0.4% to 6,370, the Nasdaq off 0.34% to 21,100, and the Dow dropping 153 points — all while everyone's supposedly bullish on rate cuts. The cognitive dissonance is thick enough to choke on.

Powell faces an impossible binary. Hint at September cuts, and he looks like he's capitulating to political pressure. Stay hawkish, and he'll get crucified by markets expecting relief. The data has been zigzagging enough to justify either path, which means Wall Street is setting itself up for serious disappointment.

But here's what nobody wants to acknowledge: this whole Jackson Hole spectacle has become a farce. We're watching the slow-motion destruction of Fed independence, dressed up in academic papers and mountain lodge charm. Powell knows it. The markets know it. Hell, even the tourists in Jackson know it.

The real question isn't what Powell will say Friday. It's whether anyone still believes the Fed operates in anything resembling independence when the President is publicly threatening prosecution of Fed governors and demanding rate cuts like he's ordering room service.

This is what monetary policy looks like when democracy eats its own institutions.

Welcome to Wyoming, Jerome. Try not to let the altitude get to your head — though at this point, the thin air might be the least of your problems.