Sizling

Trump has publicly demanded steep rate cuts: in 2025 he urged the Fed to lower its benchmark rate “immediately.”

In mid-2025, he explicitly said he wanted rates cut to 1% (or “even below 1%”).

His frustrations appear rooted in concerns over high borrowing costs for the government, mortgages, and broader economic growth.

So yes — the scenario you described is grounded in actual statements from Trump.

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⚠️ Why a 1% rate cut is widely viewed as unrealistic / risky (despite the demand)

The current policy rate (as of last Fed decisions) is much higher — a dramatic drop to 1% would represent a historically large shift.

Economists warn that such a sharp cut — especially when inflation and economic activity metrics don’t warrant it — could destabilize long-term expectations, re-ignite inflation, and erode trust in the Fed’s independence.

Historically, sub-2% rates have been used primarily during crises — not when the economy shows decent growth and employment.

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💥 What would happen if the Fed actually cut to 1% (or very low rates) — the “market-ignite” scenario

Capital flows & risk-asset rally: Lower rates make borrowing cheaper, making equities, real estate, and higher-risk assets more attractive. The jump in liquidity could trigger strong rallies across markets (stocks, crypto, etc.).

Volatility & uncertainty: Such a radical policy shift — especially under political pressure — would unsettle many institutional investors. Volatility could spike initially.

Long-term inflation & debt costs: While cheap credit might boost growth short-term, there’d be a high risk of inflation rising and government debt servicing becoming costlier in real terms — undermining some benefits.

Credibility & central-bank independence concerns: If the Fed caves to political pressure rather than data, market confidence in its judgments might erode — which often makes volatility bigger, not smaller.

So yes — if the Fed actually followed Trump’s demand wholesale, markets could “explode.” But it would also carry big risks.

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🧠 My take — what’s more likely (and what to watch out for)

> “Trump has demanded a 1 % rate but the data environment and institutional constraints make such a cut improbable. More likely we’ll see modest cuts (if any).
Still, markets — especially speculative/risk-asset players — will likely price in the chance of aggressive rate cuts anyway. That alone could fuel rallies, even before any real change.”

Bottom line: The headline — “Trump demands 1% → markets ready to pop” — is real and captures the tension. But treating it as imminent fact is risky. If anything, expect cautious reaction, not a guaranteed market surge.

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📰 Context: Where this stands now

Trump’s pressure has increased recently, including calls for the Fed board to override current leadership if rate cuts aren’t delivered.

Some of his allies (or potential Fed-appointees) have voiced support for aggressive cuts — but most of the Fed remains cautious, given inflation and economic data.

Many economists warn that a 1% policy rate in today’s environment could be more of a policy shock than a boost — and markets would react accordingly, not always positively.

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Rumors have been swirling that Powell might resign — in particular reports that he could step down “today at 7:00 PM ET” during an emergency meeting.

But these rumors remain unverified: mainstream media and Fed-official sources have not confirmed any resignation.

According to recent reporting, most analysts believe a Powell resignation this year is very unlikely.

By law, the Fed Chair (and relevant Appointments) have constraints — and chairs usually serve until their official term ends.

Bottom line: there is no credible evidence that Powell is resigning imminently — the “breaking news” alert seems to come from rumor, not confirmed fact.

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⚠️ Implications if the rumor were true (but again: unconfirmed)

A sudden resignation of the Fed Chair would likely cause strong volatility in financial markets — uncertainty often scares investors.

In such a scenario, markets (stocks, bonds, crypto) sometimes rally if investors expect a new, more “dovish” (easy-money / rate-cut-friendly) leader to take over — especially if there’s widespread belief that rates will be lowered.

For cryptocurrencies like Bitcoin, macro risk (inflation, interest rates, currency moves) — and potential “dovish shock” — could fuel a bullish impulse, as investors might turn to risk assets.

So the notion of a “bullish reaction” if Powell exits isn’t outlandish — but it hinges entirely on the premise that he’s actually leaving.

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🧠 What recent developments suggest instead

Reports show that while there is “buzz” around a future Fed-leadership change, the timeframe most consider is around May 2026, when Powell’s current term expires; not “today.”

Among the leading possible successors is Kevin Hassett, a known advocate for lower interest rates — which partly explains why markets (and crypto holders) are watching developments closely.

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✍️ My take — how you could frame the “breaking news” claim (or treat it) in analysis / social-media / investment context

> “There are circulating rumors that Powell might resign tonight — but nothing credible confirms it. If such a surprise resignation did happen, it could trigger a rally in markets (including crypto) amid hopes for easier monetary policy.
Until and unless the Fed or reputable media confirm a departure, treat the claim as highly speculative, not fact.”
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December 1, 2025 — A New Monetary Era Has Officially Begun

The Federal Reserve has ended Quantitative Tightening, freezing its balance sheet at $6.57 trillion.
The most aggressive liquidity drain in central-banking history—$2.39 trillion sucked out of the system—is over.

But make no mistake…
This isn’t “normalization.”
This is transformation.

💥 The Safety Nets Have Vanished

The Overnight Reverse Repo Facility, once holding $2.5 trillion in excess cash, has crashed to almost zero.
The cushion that stabilized markets for three years? Gone.

Bank reserves are now at $3 trillion, roughly 10% of GDP—the danger zone where financial plumbing starts to creak.

⚠️ Stress Is Already Showing

In October, the Secured Overnight Financing Rate blew past the Fed’s target, hitting 4.25%.
The Standing Repo Facility—meant for emergencies—was tapped for $18.5 billion in a single day, the biggest use since it was created.

The SRF is no longer a fire extinguisher.
It’s part of the daily routine.

🧨 A Permanent Shift

The Federal Reserve is now embedded inside the Treasury market’s core.
Every night, the SRF stands by to transform government debt into fresh reserves—instantly, automatically, without limit.

The Fed has evolved from lender of last resort to:
👉 Lender of continuous resort.

🏛️ And the Timing? Brutal.

The December 10 FOMC is heading toward a rate cut with 82% odds, but they’re effectively flying blind.

A 43-day government shutdown wiped out two months of inflation data. CPI sits at 3%, still above target—and the Fed will vote without knowing what happened during the blackout.

💣 Meanwhile…

U.S. debt: $36+ trillion

Annual interest costs: $1+ trillion

A monetary structure now exists that guarantees Treasury collateral can always be monetized.

This is not a tweak.
Not a shift.
Not a policy adjustment.

🔥 This is the birth of an entirely new monetary regime.
🔥 The Standing Repo Era has begun.

And its consequences will ripple through markets, currencies, and global finance for decades.

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