December 10, 2025
Federal Reserve chairman Jerome Powell was Jerome Powell-ing today. He had quite the moment during today’s press conference – of course he made big economic news that’s going to impact the prices we’re all paying, trump’s tariffs, your job security and wager. And I am going to get to all of that in a second.
But first let’s talk about the moment. Jerome Powell – the Federal Reserve chairman is famously very stoic. He doesn’t ever take the bait from reporters he doesn’t talk shit and he can sometimes appear very boring. Which is what you want from the guy in charge of the monetary policy for the biggest economy in the world. Of course President Trump has been beefing with Powell since Trump came back into office. He’s called Powell every name in the book. And recently he’s been talking a lot about who he’s going to replace Powell with when Powell’s term is up next year. Well – Jerome Powell was asked about that today.
That’s as close to a Jerome Powell clap back as you’re going to get. One word. Simple. Effective. Of course everyone laughed because Powell is saying – at least publicly – he doesn’t give a crap what President Trump says about him, he’s going to continue to do his job.
Now – let’s talk about the actual important economic news the fed made today. Look, this economy is tricky. Inflation is up and the jobs market is weak. That’s a double whammy that leaves the federal reserve in a pickle.
Wait – did he just say tariff inflation? Yes he did…which I’m going to get to in just thirty seconds. But first – as I reported earlier today the Federal Reserve decided to cut interest rates by a 0.25%. This was the third rate cut this year. But the question is what about next year? Well – the fed is tentatively penciling in one more rate cut in 2026. But you may be wondering why just one rate cut next year?
Well – because the Fed is trying to make sure rates are low enough so that employers are able to borrow what they need to hire people instead of firing people. But at the same time, it’s a balancing act. Because when you lower interest rates to help out the jobs market, you run the risk of inflation creeping up, which then makes prices higher for everyone…and right now we’re already starting to see that. On top of that — the fed chairman said multiple times today that the tariffs imposed by President Trump have absolutely contributed to inflation especially when it comes to goods. He said we aren’t really seeing inflation when it comes to services – but we are for things like furniture, electronics and clothes – goods. But Powell said the Fed is committed to making sure that the price increases we’re all feeling from trump’s tariffs aren’t going to continue next year.
Did you hear him? He said “likely…” “likely a one time price increase?” The chairman is saying that it’s just a theory they have that trump’s tariffs are going to only cause prices to go up once. But that’s not a guarantee – especially if the president decides to add more tariffs on other countries…which Trump keeps threatening he will do. But the chairman also acknowledged that this isn’t happening in a vacuum. He said on top of the tariffs — he’s well aware that prices are also too high for most people which is a result of that extremely high inflation from 2021 and 2022 – complicating matters is the fact that wages especially for lower and middle income Americans aren’t keeping up. Obviously the Fed can’t control prices and they can’t control what your employer does about your wages but – they can control – somewhat – how the economy responds…and he says it’s going to probably be years before things come into balance.
Read the Fed’s 2026 projections here.
Watch the Chairman’s press conference here.
