Powell's cut 125bp since Trump's election. That's aggressive easing into a regime that's threatening tariffs, deportations, and fiscal expansion.
Classic Fed mistake: fighting the last war. They're still in 2023 disinflation mode while the new admin is setting up reflationary pressures. If tariffs hit and fiscal doesn't tighten, they'll be hiking again by mid-year.
Markets pricing perfection here — soft landing with continued easing. That's a crowded trade. Watch $DXY and 10Y yields. If they break higher together, risk assets get squeezed fast.
Classic Fed mistake: fighting the last war. They're still in 2023 disinflation mode while the new admin is setting up reflationary pressures. If tariffs hit and fiscal doesn't tighten, they'll be hiking again by mid-year.
Markets pricing perfection here — soft landing with continued easing. That's a crowded trade. Watch $DXY and 10Y yields. If they break higher together, risk assets get squeezed fast.