Powell’s Tightrope, Trump’s Trapdoor

At Jackson Hole, the Fed chair preached “balance” while Trump’s economy yanked the floor out from under us.

Jay Powell stepped up to the podium in Jackson Hole this week, and if you squinted past the mountain backdrop you could almost see the circus tent rising behind him. There he was again, lawyer by training and financier by trade, not an economist, though Georgetown’s Jesuits surely drilled him in the art of sounding solemn, wobbling above an audience of hedge fund managers and foreign central bankers while Donald Trump and his Treasury secretary heckled from below.

Powell insisted the rope was steady. He dutifully ran through his prepared script: inflation is edging lower, the labor market is in “curious balance,” monetary policy remains “data dependent.” But strip away the central banker incantations and what he really admitted was stark: growth has slowed to nearly half last year’s pace, job creation has collapsed to a meager 35,000 a month, and Trump’s tariffs and immigration crackdowns are now choking the system.

This, Powell told us, is a “curious kind of balance.” Curious, indeed. It’s the sort of balance where demand and supply are both falling, where employers aren’t hiring and workers aren’t available, where prices are rising not because the economy is booming but because Trump’s trade war is filtering down through every supply chain. The Fed has a word for this: “challenging.” Everyone else just calls it a mess.