Everyone is obsessing over 25 basis points.
That tells me most people are staring at the wrong dial.
A quarter-point cut in the overnight rate is boring. Cosmetic. Theater.
If that’s the only lever you think the Federal Reserve has, you’re playing checkers while everyone else is rearranging the board.
There’s at least 100bps of room to cut eventually — but that’s not the story.
The real story is who controls the balance sheet, where on the yield curve policy is applied, and how much manipulation markets are about to tolerate before they snap.
And that’s where this gets uncomfortable.
Trump Might Be About to Run This Economy on Turbo
I can’t believe I’m typing this — but JPMorgan Chase might be right.
And yes, I hate their guts.
But if Donald Trump is serious about running the economy hot, the rumored Fed Chair pick actually makes sense.
The name floating to the top?
Rick — formerly of Lehman Brothers, now Chief Investment Officer of Global Fixed Income at BlackRock.
That’s not a typo.
The guy who sat at the center of the pre-2008 machine — and now manages roughly $2.4 trillion — is suddenly the leading contender to run the Fed.
Polymarket has him out in front. Trump has called him “impressive.”
Read that again slowly.
This Would Be a First — and It Matters
If this happens, it would be the first Fed Chair drawn directly from a major asset manager.
Not academia.
Not the Treasury.
Not a central-banking lifer.
An asset manager.
And not just any asset manager — the one the Fed leaned on in 2020, when roughly half of the bonds the Fed bought were BlackRock products.
So let’s connect the dots:
Lehman → helped inflate the last system
BlackRock → benefited massively from emergency Fed programs
Fed Chair → now in position to design the next emergency playbook
That’s not monetary policy. That’s vertical integration.
This is how you run it hot. For a while.
Yield Curve Control: The “Innovative” Idea Everyone Pretends Is New
Here’s the pitch you’re going to hear:
“We’re not just cutting rates — we’re being innovative.”
Translation: Yield Curve Control (YCC).
Instead of nudging overnight rates, the Fed targets 10-, 20-, 30-year yields directly by buying bonds in size.
Lower long-term yields →
Cheaper mortgages →
Higher asset prices →
Everyone feels richer.
On paper, it sounds great.
In reality? It’s been tried. Repeatedly. And it always ends the same way.
A Short, Ugly History of Yield Curve Control
Australia tried it during and after COVID. Lost control. Yields exploded higher the moment the printing slowed.
Japan has been trapped in it for decades — permanent distortion, zero dynamism.
The United States tried it after WWII. It ended in 1951, when inflation expectations completely unanchored and the Fed had to abandon the policy.
YCC works like stretching a rubber band.
At first, nothing breaks.
Then you pull more.
Then more.
Eventually it snaps — and when it does, the recoil is violent.
Short-term: markets rip.
Long-term: credibility dies.
Why This Pick Makes Sense (If You’re Trump)
Trump doesn’t want housing prices to fall.
He wants lower rates without admitting asset prices are inflated.
Yield Curve Control gives him exactly that.
But there’s another reason this candidate is perfect.
The Private Credit Problem No One Wants to Talk About
Private credit is quietly cracking.
Zombie companies.
Payment-in-kind loans.
Structures that only survive if refinancing stays cheap.
This week alone we’ve seen another large private credit deal wobble — barely a headline, because stocks are up and nobody wants to look under the hood.
Now here’s the coincidence you’re not supposed to notice:
Trump signs an executive order easing restrictions on private credit inside 401(k)s
Days later, Rick meets Trump at the Oval Office
BlackRock announces target-date funds with 5–20% private credit exposure starting 2026
That’s not random.
That’s a liquidity plan.
How the Loop Works
Private credit gets stressed
Lower yields reduce refinancing pressure
Retirement money becomes the buyer
If it still breaks?
The Fed steps in — again
BlackRock originates the loans.
401(k) holders provide the liquidity.
The Fed provides the backstop.
It’s elegant. And deeply concerning.
Private credit goes from “let it fail” → to “too embedded to fail.”
That’s how systemic risk is born.
So… Is This Bullish or Bearish?
Both.
Short term?
This would pump markets. Hard.
Lower long rates
Higher real estate prices
Relief rallies everywhere
Long term?
Debt explodes.
Distortions deepen.
The eventual unwind gets uglier.
This is not about fixing the system.
It’s about extending it.
My Take — No Sugarcoating
If you want:
Lower rates
Higher asset prices
No concern for deficits
This is your guy.
If you want:
Long-term stability
Clean balance sheets
Less leverage
You won’t get it here.
Personally, I’d rather know the game than pretend it isn’t rigged.
Which is why I’m positioned the way I am:
Conservative leverage
Real assets with margin of safety
Liquidity ready for when the rubber band snaps
You don’t fight policy.
You front-run its consequences.
Final Thought
Everyone is waiting on Jerome Powell to say “pause.”
That doesn’t matter.
If Trump steals the show by naming this Fed Chair, the message is clear:
We’re choosing growth now. Pain later.
Markets will cheer.
And someday, they’ll pay.
When that day comes, I plan to be a buyer — not a bailout recipient.
That’s the difference between reacting after it prints
and positioning before it does.
— Connor
Alpha Before It Prints
© 2025 Alpha Before It Prints
Unsubscribe