Powell’s $700B Blunder: Eight Reasons He Should Step Down
Jiangbing He, July 11, 2025

It’s well known that Elon @elonmusk and Donald @realDonaldTrump have their share of sharp disagreements — especially over the “One Big Beautiful Bill.” However, one area where they do align is their repeated calls for the Federal Reserve to cut interest rates.
Of course, their motivations differ. Both Musk and Trump have experience as entrepreneurs. Musk approaches the issue primarily from an economic standpoint—focusing on economic growth, business financing burdens, and the overall cost of capital. Trump, while sharing those concerns, also sees interest rate policy through a political lens. He understands well how rate shifts ripple through the broader economy. Ahead of last year’s election, Trump publicly warned Fed Chair Jerome Powell not to cut rates prematurely. Powell cut anyway. After the election, Trump pushed for further rate cuts—yet this time, Powell refused.
Powell had his reasons citing uncertainties from Trump's trade war. But even now, when the trade war's impact is clear, Powell continues to push back, refusing to cut rates —seemingly for the sake of opposition itself. What truly makes Trump anxious is that, without rate cuts, the interest payments on U.S. federal debt could end up being more than twice what they would be under lower rates. Put simply, if the Fed brought rates down to the 2 to 2.5% range—closer to the European Central Bank’s level — interest payments on U.S. Treasuries could fall by more than $700 billion, nearly rivaling the Pentagon's annual budget — falling just slightly short. This is one of the real fiscal consequences of Powell’s obstinacy and his tendency to fight for the sake of fighting—consequences that have spilled over into the global economy, a point Musk has also made.
Why am I the most qualified person in the world to call Jerome Powell an idiot?
First of all, as early as 2020, I published a short public essay predicting that Biden would bring four years of significant inflation to the U.S. and other major market economies (excluding China). I also forecast that inflation would eventually bring down Biden’s counterparts—that is, incumbent leaders and ruling parties across major Western economies. The Biden administration would be voted out as well, and only then would inflation begin to subside. (He, 2020).

Why did I make that prediction publicly on December 28, 2020? Because Biden’s extreme perverse energy policies were bound to send oil prices soaring. And once oil prices rise, consumer prices across the U.S. and other Western market economies would follow. That was the fiscal side of the equation. The other factor was money supply. During the COVID-19 pandemic, Western governments handed out large amounts of cash to their citizens. With both a monetary base and a solid industrial base in place, prices —especially home prices—were destined to go up (Again, this excludes China). One of my readers, who works in the U.S. telecommunications sector, read that piece and went on to purchase seven properties in Florida. I’m aware of him because he once reached out to me directly. He’s a friend of a classmate in our chat group, though he’s neither a member himself nor a paying subscriber. By my rough estimate, those properties have more than doubled in value by now.
Then, in December of last year, I published another article predicting that Trump would wage a trade war and drive down oil prices, which fell from $88 to $66 per barrel (He, 2024). Once oil prices drop, everything else gets cheaper — especially in the U.S. The importance of oil prices and their relationship to inflation were thoroughly discussed in the articles. Both of my articles began with oil as the primary driver — not interest rates. Indeed, interest rate hikes can help curb inflation, but they are not the root of the problem. The real driver is oil. And Powell still doesn’t get that.
After my first article in December 2020, inflation hit in 2021—yet Powell was still claiming it was “transitory.” What else can you call him but an idiot? In my December 2024 piece, I not only predicted Trump’s return to trade war, but also explained why a trade war would not lead to inflation. The final section of that article laid out how tax cuts would increase tax revenues and
reduce the fiscal deficit. All of these forecasts came true: the trade war, the drop in oil prices, the decline in consumer prices, and even a budget surplus of over $200 billion in April. The fact that these major events unfolded just as I had predicted proves one thing: Powell isn’t even qualified to shine my shoes. It’s clear I’m well-qualified to criticize the Fed—something most non-experts lack, which is why their commentary often misses the real issue and fails to grasp the essence.
Second, during my lectures in the past two years, I’ve discussed the “golden crossover” between the federal funds rate and the inflation rate. In monetary policy terms, the golden cross typically indicates that the effect of earlier rate hikes has begun to set in. Roughly one quarter after this point, discussions of rate cuts should begin. Policymakers should use this period to closely observe macroeconomic indicators and prepare for a potential transition toward easing.

Third, the current federal funds rate is disconnected from inflation. The Fed’s target rate is now floating between 4.25% and 4.5%, while the inflation rate has been hovering around 2.3% to 2.4%. This is benign inflation—a normal byproduct of strong economic growth, robust consumer demand, and overall prosperity. It’s entirely different from the runaway inflation of the Biden years, when prices surged across the board — especially for essentials like eggs — and ordinary Americans felt the pinch with expensive eggs and fuel. I expect the June CPI to tick up slightly, given the relatively high oil prices that month, but it will likely decline again afterward, potentially falling toward 2%.

Fourth, real-world interest rates remain far above the inflation rate. Loan rates are hovering around 7% to 8%, and even deposit rates are in the 3% to 4% range. Whether we’re talking about the federal funds rate, lending and deposit rates, or bond yields—they all sit well above inflation, especially since Trump’s return to office. The root cause of inflation isn’t interest rates—it’s oil prices. And Powell has gotten this wrong, repeatedly, for years. President Trump once called him “too late Powel”—I think that was far too polite. In my view, he’s a catastrophic policymaker whose failures have done grave damage to the country and inflicted real pain on the American people.
Fifth, proactive fiscal policies, healthy societal performance, and a normalizing social structure are being artificially suppressed and dragged down by Powell. He has caused unquantifiable
and immeasurable losses to the real economy and financial markets, but one measurable impact is bond yields. Currently, bond yields remain quite high, far exceeding the inflation rate. The federal debt now stands at $36.2 trillion. If the federal funds rate were lowered to the European Central Bank’s level of around 2.15%, or even just reduced by 200 basis points to 2.5%, starting from early this year and reaching 2% by year-end, the government would conservatively save over $700 billion in interest payments. That’s on Powell. He’s proven himself incompetent, unqualified, and morally unfit — he’s a fool of historic proportions, possibly the dumbest Fed chair in over a hundred years. I once said this during a broadcast, and even the host noted that my criticism of Powell was harsher than even Trump himself—and it’s true. This is what happens when mediocrity is put in power. If he had a shred of dignity, he would resign immediately and disappear. The man’s better suited to shining shoes than running monetary policy.
Sixth, the “Big and Beautiful” Act represents a proactive fiscal policy. However, today’s high-interest-rate, contractionary monetary policy has seriously offset its positive effects. When the economy is strong, it makes sense to raise taxes on the fiscal side to curb over-investment, and to raise interest rates on the monetary side to encourage savings and suppress impulsive consumption and investment. But when the economy is weakening, what is needed is a proactive fiscal policy—cutting taxes and stimulating consumption—and a monetary policy that cuts interest rates, discourages saving, and channels money out of the banks and into the real economy for consumption and investment. This is the proper coordination of fiscal and monetary policies.
Seventh, the Federal Reserve’s sustained high interest rates have led to elevated social financing costs. Whether through direct financing via bond issuance or indirect financing via bank loans, the cost of capital remains high. This has distorted pricing for U.S. goods, leaving producers unwilling or unable to cut prices. Instead of curbing inflation, this has paradoxically contributed to it. In effect, this is inflation engineered by policy—Powell’s artificially inflated interest rates have pushed up the price of American goods, undermining their global competitiveness. His twisted and abnormal high-rate regime is a distortion by any standard—domestically and internationally — and its long-term damage to American manufacturing and exports will be substantial.
U.S. labor costs are already high. Powell’s artificially elevated interest rates have only worsened the situation by pushing financing costs even higher—leaving American products overpriced and struggling to compete globally. Trade wars and corporate tax cuts—both initiatives under Trump—were intended to benefit U.S. businesses. Tariffs provided protection for domestically produced goods, and tax cuts helped reduce corporate burdens. But none of these policies can offset the damage caused by excessively high financing costs. When both direct and indirect financing costs remain elevated, those costs inevitably get passed on to product prices. And with American goods priced too high, they lose their edge on the global market.
Eighth, no central bank should attempt to curb inflation at the expense of destroying its own economy—and the Federal Reserve is no exception. The Fed’s persistently elevated federal funds rate has significantly increased social financing costs, placing an especially heavy burden on unlisted small and medium-sized enterprises—pushing unlisted small and medium-sized enterprises to the brink. If interest rates aren’t lowered swiftly and decisively, a wave of further closures is inevitable. Tax cuts alone are insufficient to offset the crushing weight of high financing costs. In some regions, we’re already seeing widespread closures of small businesses—this should serve as a serious warning.
Powell’s foolishness is plain to see—it’s just that most people can’t articulate the reasons behind it. That’s exactly what I’ve done here with the eight points above. Powell has proven himself unfit for the role of Fed Chair. He should step aside before doing more harm. If you can’t stand the heat, stay out of the kitchen. That’s the kindest advice I can offer. People say, “You shouldn’t fall into the same hole twice.” But under Powell’s leadership, the Fed has stumbled into the same inflation trap twice in five years. In 2021, when Biden’s policies triggered surging inflation, Powell dismissed it as “transitory.” Four years later, he claimed Trump’s trade war would cause a new wave of inflation—but three months have passed, and the inflation Powell had been hoping for simply never arrived.
The longer Powell stays, the greater the damage to the U.S. economy. This man is arguably the most harmful Fed chair in modern history. The sooner he steps down, the better—for the country, for the economy, and for the world.

鲍威尔应该辞职的八大理由 一年让财政部多付7000亿美元
贺江兵 2025-07-11

各位朋友大家好，今天是2025年7月11日，我们今天讲一下美联储主席鲍威尔每年让美国多支出7000亿美元的话题。

众所周知，马斯克和川普有很多分歧，比如在大而美法案上分歧都比较严重，但两人都多次呼吁美联储降息。当然，他们的出发点不一样，马斯克和川普都做过企业家，先说马斯克，他主要从经济增长和企业的压力，社会融资成本的角度来考虑。老川除了这个角度以外，从政治的角度看，当然也知道利率调整对经济的影响。去年大选之前也喊话鲍威尔选前不能降息，鲍威尔降了；大选之后让鲍威尔降息，鲍威尔却又不降了。
鲍威尔不降息的原因非常充分，说是川普打贸易战的不确定性。现在贸易战影响确定了，他还是对着干，仍然不降息。老川着急的是，不降息会导致美国国债的利息支付要高一倍多。简单地说，如果和欧洲央行一样降到2-2.5%，美国联邦债券的付息可以减少7000多亿美元，只比军费略低。这就是鲍威尔耍横、为斗而斗对美国联邦的伤害，对世界经济也有伤害。这一点马斯克也说过。

为什么我是这个世界上最有资格骂鲍威尔是蠢货？

第一，早在2020年，我就写过一篇公开发表的小论文，阐明拜登会带来美国和其他主要市场经济体（不含中国）四年的大通胀，并且因为通胀的原因会导致拜登同行们纷纷被选下去，拜登当局也会滚蛋，拜登滚蛋之后，通胀才会下去 (He, 2020)。为什么我在2020年12月26号公开发表这个预测？拜登当局变态的能源政策会导致油价飙升，油价升，美国和西方市场经济体的物价都会上涨。这是财政方面的原因。另一个是货币供给，在Covid19流行期间，西方各国政府都给老百姓发了钱，有了货币基础，又有产业基础，这样物价、房价都会涨（不含中国）。有读者看了那篇文章买了房子，是一位在美国的电信产业的读者，在佛罗里达买了7套房子，现在可能翻倍都不止。这个人我知道，他和我聊过，是群里一位同学的朋友，不是会员，他没有进来。另外，去年十二月我公开发了一篇文章，也预测了老川会打贸易战，并且会将油价打下来，油价从88打到了现在66美元每桶 (He, 2024)。油价一落，万物降价，尤其对美国。油价的重要性以及和物价的关系，文章里都有详细论述，两篇文章都是以此为起点，而不是加降息。加息对抑制通胀有作用，但不是最主要的，最根源的是油价，这点鲍威尔不懂。第一篇文章2020年12月发了之后，2021年通胀来了，鲍威尔还在说通胀是短暂的，是不是个蠢货。这一轮我在去年12月的文章里预测了老川会打贸易战，并在其中论述了贸易战不会导致通胀的理由。第二篇文章的最后一部分阐述减税会增加税收减少赤字。这些预测都发生了，贸易战、油价下跌、物价下跌，并且美国的财政在四月份盈余2000多亿。这些大的事件如预期发生说明鲍威尔的水平还不配给我提鞋，也可见我是非常有资格骂美联储的，外行骂美联储不得要领。

第二，我在前两年讲课时讲过美联储基准利率和通胀率的黄金交叉。黄金交叉一个季度之后都要考虑降息了，从货币政策的角度来说，黄金交叉表明加息的效力已经达到，需要开始观察准备降息。

第三，现在的美联储的联邦基准利率和物价是脱节的。现在基准利率是4.25到4.5之间浮动，而通胀率在2.3到2.4之间徘徊。这个通胀率是良性的通胀，经济增长、消费旺盛、经济繁荣必然伴随
的正常现象。这不是拜登四年时期的恶性通胀，那四年物价飙升，尤其是鸡蛋，美国老百姓感受得到鸡蛋、加油都很贵。六月份的CPI，我预测会有点反弹，因为六月份的油价比较高，之后还会降下去，降到2左右。

第四，现实中的利率远远高于通胀率，比如贷款利率要到7%到8%，存款利率也到3%到4%左右。无论是联邦基准利率，还是存贷款利率，或是债券收益率都是高于通胀率，尤其是自川普第二次上任以来。通胀的根本原因不是利率影响的，而是油价影响的，所以鲍威尔又错了，反复地错，错了好几年。川普先生说他是太晚先生，我看是太客气了，我看是个祸国殃民的蠢货。

第五，积极的财政政策、健康的社会表现、趋于正常化的社会形态，被鲍威尔人为压制拉低。他人为地对实体经济、金融市场造成了无法量化、不可估量的损失，但可以量化的一点是债券收益
率。目前债券收益率还是挺高，远远高于通胀率。联邦的债务是36.2万亿美元，如果联邦基准利率也如欧洲央行降到2.15，就算只降到2.5，降200个基点，从年初开始降，到年底降到2%左右，联邦政府为债务少支付的利息保守估计都有7000多亿。这就鲍威尔干的事，他可以说是无能、无德、无才，是美联储百年历史上最蠢的货。这个评价，我在做节目的时候，主持人说我骂鲍威尔比老川骂的更狠。确实如此，这就是无能、庸才的代价，他要是要脸的话，应该赶紧主动下跪滚蛋，有多远滚多远，这货不适合干这个工作，适合去擦鞋。

第六，大而美丽法案是个积极的财政政策，现在的高利率消极的货币政策严重的抵消了积极的财政政策。在经济好的时候，财政上加税遏制投资，货币政策上加息鼓励存款抑制消费投资的冲动；如果经济下滑，需要积极的财政政策，减税、刺激消费，货币政策要降息，不鼓励存款，让钱从银行到市场去消费投资，这才是配套的财政货币政策。

第七，由于美联储的高利率造成社会融资成本高，无论靠发债直接融资还是银行贷款间接融资，利率都偏高，造成美国产品的价格扭曲，不敢降价，反而达不到抑制通胀，而是造成通胀。这就人为的造通胀，人为的抬高美国产品价格降低了美国产品的国际竞争力。鲍威尔扭曲变态的高息，这个高利息不论是从国内还是国际上看都是扭曲的，这个扭曲的高息对美国产品的伤害是长期的。由于美国用工成本，再加上人为长期高利率造成的融资成本高，会导致美国产品的价格高，价格高就没有国际竞争力。本来贸易战和减税对美国企业都是利好，川普打贸易战对美国国内生产的产品有保护，减税也可以降低企业的负担，但都不足以弥补或抵消过高的融资成本。直接和间接融资成本都高的情况下，成本会被分摊到美国产品的价格上，美国商品价格高，在国际上会缺少竞争力。

第八，任何国家的央行不能以摧毁国家经济为代价来抑制通胀，美联储也不例外。由于美联储的基准利率长期地过高造成社会融资成本负担加剧，尤其是未上市中小企业会大量地破产倒闭。未来如果还不及时快速地降息，会造成美国的很多中小企业难以为继。税收的减免不能有效抵消融资成本的高企，在部分地区已经出现很多中小企业的关门倒闭的现象，应该引以为戒。

以上就是人人都看得到鲍威尔是蠢货，但又说不出来的原因。鲍威尔干不了这个美联储主席这个活，早点辞职下台，没有金刚钻不要揽瓷器活，这是我给他的忠告。人不能掉进一个坑两次，而美联储在鲍威尔的领导下在通胀这个坑里五年掉进去了两次：2021年拜登制造的通胀来了，他说“通胀是短暂的”；四年后他说川普贸易战会导致通胀，三个多月过去了他盼望的通胀就是没来。鲍威尔呆的时间越长对美国的伤害越大，这祸国殃民的货应该早点滚蛋。

References
He, J. (2020, 12 28). 2021全球通胀 中国经济自加五难题. 苹果日报 | 博谈网. https://t.co/3guh9ZdKgs
He, J. (2024, December 15). 贺江兵 on X: "@elonmusk @realDonaldTrump He Jiangbing: Starting in 2025, the United States Will Lead the World into Deflation Rather than Inflation, and Reduce Its Deficit Rather than Increase It😊 Before the 2024 U.S. presidential election, Nobel ... X. Retrieved July 11, 2025, from https://t.co/evggEjbQ2k
张, 淑. (2024, December 14). 中國學者分析：川普上台通膨降低更能打貿易戰| 兩岸. 中央社. https://t.co/MeeT6bLNHV