The Fed’s Powell Is Getting More Hawkish as Market Starts Using the ‘R-Word’

The Breakdown

Blockworks

Business, Investing

4.8 • 806 Ratings

🗓️ 25 March 2022

⏱️ 17 minutes

🔗️ Recording | iTunes | RSS

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Summary

his episode is sponsored by Nexo.io, Arculus and FTX US. On today’s episode, NLW takes a tour of recent macro sentiment, focusing on the shifting tone coming out of the U.S. Federal Reserve. In speeches and interviews this week, Fed Chair Jerome Powell made it clear the central bank was prepared to raise rates 50 basis points at its next meeting if needed, and to do so at multiple meetings this year. While 50bps in the context of 7.9% inflation may not seem like a lot, the last time the Fed raised rates 0.5% in a single meeting was March 2000. - Take your crypto to the next level with Nexo. Invest and swap instantly, earn up to 20% APR on your idle assets or borrow cash against them at industry-leading rates. Get started today at nexo.io to receive up to a $100 welcome bonus. Valid through March 31. - Arculus™ is the next-gen cold storage wallet for your crypto. The sleek, metal Arculus Key™ Card authenticates with the Arculus Wallet™ App, providing a simpler, safer and more secure solution to store, send, receive, buy and swap your crypto. Buy now at amazon.com. - FTX US is the safe, regulated way to buy Bitcoin, ETH, SOL and other digital assets. Trade crypto with up to 85% lower fees than top competitors and trade ETH and SOL NFTs with no gas fees and subsidized gas on withdrawals. Sign up at FTX.US today. - Consensus 2022, the industry’s most influential event, is happening June 9–12 in Austin, TX. If you’re looking to immerse yourself in the fast-moving world of crypto, Web 3 and NFTs, this is the festival experience for you. Use code BREAKDOWN to get 15% off your pass at www.coindesk.com/consensus2022. - Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW ** “The Breakdown” is written, produced by and features Nathaniel Whittemore aka NLW, with editing by Rob Mitchell, research by Scott Hill and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “I Don't Know How To Explain It” by Aaron Sprinkle. Image credit: Samuel Corum/Getty Images, modified by CoinDesk. Join the discussion at discord.gg/VrKRrfKCz8.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.1	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:15.0	The breakdown is sponsored by nexo.io, Arculus, and FtX, and produced and distributed by CoinDesk.
0:22.8	What's going on, guys? It is Thursday, March 24th, and today we are talking about why Jerome
0:28.4	Powell is getting even more hawkish, and asking the question is a recession the only way out.
0:36.2	Before we get into that, however, if you were enjoying the breakdown, please go subscribe
0:39.8	to it wherever you listen to podcasts, give it five stars, leave a review, or if you want to
0:45.2	get deeper into the conversation, come join us in the Breakers Discord.
0:49.2	You can find a link in the show notes or go to bit.ly slash breakdown pod.
0:53.8	Also, a disclosure as always, in addition to them
0:56.4	being a sponsor of the show, I also work with FTX. So today we are checking in on the macro
1:02.5	environment, and of course, in the world that we live in, a big part of that discussion is
1:06.7	necessarily what the Fed is doing, what the Fed is thinking, what the Fed is thinking about
1:11.9	thinking about in the future. In fact, we live in this very strange environment where huge,
1:17.6	huge parts of the market hang so intensely, not just on the actions the Federal Reserve takes
1:23.6	to calibrate monetary policy, but the words that they use to describe where they might
1:28.3	take monetary policy. I guess on the one hand this makes sense. Markets are forward-looking and
1:34.0	trying to glean any insight so as to get ahead of those changes. At the same time, it means
1:39.2	that in some ways the Fed's most powerful tool is the tool of self-fulfilling prophecy, of trying to drive
1:45.8	markets where they want them to go without even taking the actions that would theoretically
1:49.6	make them go there. Indeed, some, like notably Jeff Snyder, believe that this market
1:54.6	influence is the primary power the Fed has, with actual monetary policy being far more
	...

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