🚨 POWELL’S POLICY PANIC: IS THE FED CRASHING THE ECONOMY?
The latest data is in, and the cracks are no longer just visible—they are widening. While Federal Reserve Chair Jerome Powell has been sounding the alarm on "sticky" inflation, today’s January CPI release tells a completely different story.
$DCR We are looking at a classic "Policy Mistake" scenario that could define the next decade of the US economy. Here is the breakdown:
📉 The Inflation Mirage
Despite fears that 2025’s tariffs would ignite a price spiral, the numbers show a cooling trend that the Fed seems to be ignoring:
Headline CPI: Came in at 2.4% (vs. 2.5% expected)—the lowest since the 2025 tariff implementation.
Core CPI: Dropped to 2.5%, hitting a 5-year low and reaching levels not seen since the 2021 lockdowns.
$DUSK The Reality: The Fed’s current restrictive stance (holding rates at 3.50%–3.75% in January) is fighting a ghost. Inflation is trending down, yet the "higher-for-longer" hammer is still swinging.
⚠️ The Economy is "Breaking" in Real-Time
While Powell waits for a perfect 2.0% target, the rest of the economy is paying the price:
Labor Market Shivers: While January payrolls showed a slight bounce, the unemployment rate has been climbing steadily toward 4.3%, a far cry from the "labor tightness" of previous years.
The Debt Bomb: Credit card and mortgage delinquencies are surging. Total household debt has ballooned to $18.8 trillion, with nearly 4.8% of all debt now in some stage of delinquency.
Corporate Carnage: Bankruptcy filings are at a 15-year high. Small and mid-sized businesses are collapsing under the weight of interest payments they can no longer afford to refinance.
$LAYER 🛑 The "Too Late Powell" Trap
In 2021, the Fed was "too late" to hike, leading to the worst inflation in 40 years. Now, the roles have reversed. By remaining hawkish while the consumer is bleeding, the Fed risks a Deflationary Spiral—a monster that is historically much harder to kill than inflation.
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