Everyone came into this meeting braced for a hawk.
Sticky inflation. Tariffs. A “higher for longer” lecture.
Instead, we got something very different.
Jerome Powell didn’t just hold rates — he sounded comfortable.
Not euphoric. Not reckless.
But for an economist whose job is to worry professionally, this was about as bullish as he gets.
And that matters.
The Tone Shift Nobody Is Talking About
Here’s the simple truth:
If Powell were genuinely worried, you would’ve heard it.
You didn’t.
He talked about:
Inflation expectations staying anchored
The economy being well positioned
Risks to inflation and employment both diminishing
He refused to explicitly say the risks were “balanced,” but he didn’t need to.
The implication was clear: we’re no longer in emergency mode.
That’s a big change from where we were.
Inflation: The Boogeyman With an Expiration Date
Powell was unusually specific about why inflation is still elevated.
Not demand.
Not wages spiraling.
Not some runaway services problem.
It’s goods inflation tied to tariffs.
Strip tariffs out, and inflation is already flirting with 2%.
That matters because tariff-driven inflation behaves differently:
It shows up suddenly
It’s visible in the data
And—crucially—it fades on a year-over-year basis
Powell basically told you when that happens.
Summer.
Once those YoY comps roll off, the door to rate cuts reopens.
Not tomorrow.
But this isn’t a “no cuts for years” regime either.
The Myron Signal (Pay Attention Here)
The vote was 10–2 to hold. No surprise.
But the shift inside the Fed was.
Myron—previously leaning toward a 50bp cut—downgraded his view to 25bp.
That’s not hawkish.
That’s confidence.
It says:
“The economy doesn’t need emergency medicine anymore.”
When even the more aggressive voices start backing off, it tells you something important: the data is holding up.
The Labor Market: Stalling Without Breaking
This was the most misunderstood part of the press conference.
Powell floated an idea that made a lot of people uncomfortable:
What if labor demand slows…
At the same time labor supply slows…
And employment just… balances?
Less hiring.
Less firing.
Less immigration.
Is that bad?
From a worker’s perspective, it’s not great.
From a corporate earnings perspective? It’s phenomenal.
Lower costs.
Higher margins.
EPS expansion.
That’s why you can have:
Flat payroll growth
While asset prices keep rising
It’s not healthy for everyone — but markets don’t price morality. They price cash flows.
Why Surveys Don’t Matter Right Now
Powell flat-out dismissed the doom surveys.
People say they’re miserable…
Then they go spend anyway.
That disconnect matters.
Markets don’t trade how people feel.
They trade how people behave.
And behavior says:
Spending is resilient
Balance sheets aren’t breaking
Confidence ≠ consumption
That’s bullish.
A Quietly Important Statement Change
This line was removed from the Fed statement:
“Downside risks to employment have risen.”
That’s not accidental.
Powell told everyone not to over-read it — which usually means you should.
Removing that language signals:
The Fed doesn’t see labor deteriorating
The urgency to cut has faded
The baseline scenario is hold and wait
Not hike.
Not panic.
Wait.
No Hikes. No Rush. Neutral Territory.
Powell made this explicit:
There is no base case for a rate hike anywhere inside the Fed.
Rates are likely near neutral.
That’s a massive difference from 2022–2023 thinking.
Translation:
“We’re restrictive enough. Now we let inflation burn off.”
That means cuts may come later than markets want — but they’re not gone.
Watch These Three Things (Everything Else Is Noise)
This entire setup holds unless one of these breaks:
The stock market drops ~20%
Private credit cracks
The labor market falls off a cliff
None of those are happening right now.
The 10s–2s spread sits around 66bps.
Historically, recessions show up closer to 125bps.
We’re not there.
Could it spike? Yes.
Is it signaling imminent recession? No.
The Political Layer: Not a Coincidence
Right as Powell was speaking, Scott Bessent announced a delay in the Fed Chair decision.
That timing wasn’t random.
If Powell had come out hawkish and tanked markets, you likely would’ve seen a fast announcement.
Instead:
Dovish hold
Markets steady
Decision delayed
Stability buys time.
And stability is bullish.
Bottom Line
This was not a hawkish meeting.
It was:
Confident
Controlled
Forward-looking
Powell sounded like someone protecting his legacy:
“We navigated inflation without breaking the economy.”
Is it guaranteed to hold? No.
But right now, the data says:
Growth is intact
Inflation is manageable
Labor is stable
Risk is contained
That’s not bearish.
That’s the clearest soft-landing confirmation we’ve had yet.
We’ll know when it breaks.
And until it does — the trend remains your friend.
I’ll be watching it all.
Before it prints.
The Part Nobody Tells You
Macro understanding is table stakes.
The money isn’t made by knowing Powell was bullish.
It’s made by knowing where to deploy capital when the market misreads it.
That’s exactly what I do inside Alpha Premium.
Not trade alerts.
Not hot takes.
Not “buy this ticker now.”
You’ll see:
How I’m positioning capital before consensus catches up
Where I’m leaning in vs. staying defensive
What I’m buying, what I’m avoiding, and why
How I size risk when the narrative is loud but the signal is subtle
If you want to understand how I’m actually deploying capital in this environment —
that happens inside Alpha Premium.
See how I’m deploying capital ⬇️
(This is where the real work lives.)
— Connor
Alpha Before It Prints
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