On Wednesday afternoon local time, in a venue in Manhattan just 1 km away from the 'CEO assassination incident' that shocked the entire United States, Fed Chairman Powell participated in a public interview event and discussed topics of high external interest such as the new Trump administration.

Unlike the usual serious policy discussions, although it is inevitable to talk about policies, Wednesday was more like a casual sharing session for the Fed Chairman.

A knock on the door changes life.

As we all know, Powell obtained a bachelor's degree in political science from Princeton and later a JD degree in law from Georgetown University. But to understand his transformation from a lawyer to the Fed Chairman, we need to start with a knock on the door.

After graduating from college, Powell first worked for 6 years in a legally-related job and then switched to the investment bank Dillon, Read in 1984, engaging in financing, commercial banking and business.MergerAnd at that time, the chairman Nicholas Brady, not only had a history of serving as a senator, but would also later become the Treasury Secretary for the Reagan and the first Bush administrations.

(1988, Reagan with Nicholas Brady, Source: The White House)

Powell introduced that he did not have a very clear concept while studying, the only idea was to spend most of his life in the private sector, occasionally taking on some public roles.

Fed Chairman introduced: "One day, I forced myself to go upstairs to knock on Brady Corp's super luxurious office door and told him that if he was going to work in Washington DC in the future, I would be willing to serve you."

After listening, Brady Corp asked his assistant to write down Powell's name, then he left reluctantly. Unexpectedly, several months later, Powell received a call asking him to "come up." Since then, the two have been working together, Powell switched to the Treasury Department in 1990 and became the Deputy Secretary of Domestic Finance at the Treasury Department in 1992. His work during his tenure included persuading Buffett to take over the mess at Salomon Brothers.

Powell emphasized that if he hadn't overcome the fear in his heart, including the fear that Mr. Brady Corp misunderstood him, he would not be able to sit in his current position today.

Even when working at the Treasury Department, Powell also mentioned that at that time, he never thought that one day he would work at the Fed. Subsequently, after researching the debt ceiling issue following the subprime crisis, and helping the Obama administration persuade the Congressional Republican Party to raise the debt ceiling, Obama sent Powell to the Federal Reserve Board as a reward.

Talking about the Trump administration: There will be no "shadow Fed".

As in the past, Powell mechanically emphasized that the independence of the Federal Reserve is protected by U.S. law.

However, Trump has also discussed the idea of a "shadow Fed" - by appointing a shadow Fed chair in advance, releasing "forward guidance" externally, making the actual speeches by Powell less important.

In response, Powell gave a meaningful look.

He also stated that this scenario is unlikely to happen, as there is a fixed way in which the Federal Reserve interacts with various government departments, especially the Treasury. Over the past 75 years, the Fed chair and the Treasury Secretary have met every week for a meal, sometimes breakfast, sometimes lunch. More importantly, institutions also respect boundaries and power limits.

Although Powell is also a "Wall Street veteran", he revealed that he is not familiar with the nominated Treasury Secretary Benson by Trump, and he is confident that his relationship with Benson will be similar to (his relationship with) other Treasury Secretaries.

Powell also explained why the 'Trump tariffs' cannot be included in policy considerations now: 'We do not know how much tax will be added, do not know the specific timing, what goods will be affected, which countries' goods will be taxed, how tariffs will pass into prices, what retaliatory measures other countries will take, so it is impossible to formulate policy based on so many unknowns.'

Powell stated that the Fed will model, evaluate, and observe tariff issues, but monetary policy is about what is happening now.

U.S. economy better than expected in September

In statements regarding the U.S. economy, Powell stated that the economic conditions are 'very good', with inflation declining and relatively low unemployment. He added that the economy is stronger than expected in September, giving the Fed more room to be more cautious in lowering interest rates.

He also responded that the September larger-than-expected rate cut was intended to send a signal: if the labor market continues to be weak, the Fed is ready to support the labor market at any time.

Regarding the Biden administration's non-farm data adjustments, Powell stated that this is a typical performance of an improving job market. At the same time, the non-farm survey data is also one of the best labor data. The final employment data will be adjusted based on tax data, but the survey-based non-farm report remains one of the earliest data available.

Discussing Bitcoin

Regarding cryptos, and the potential for the US to hold bitcoin as national reserves, Powell emphasized that $Bitcoin (BTC.CC)$ its competitor is gold, not the dollar.

Powell stated that Bitcoin is like gold, only virtual. People do not see Bitcoin as a tool for payment or storing value, as its volatility is too high. Therefore, Bitcoin is not a competitor to the dollar, but is competing with gold.

Just before Powell made this statement, the US President-elect Trump announced the nomination of crypto supporter Paul Atkins as the Chairman of the US Securities and Exchange Commission. This appointment also caused a short-term surge in Bitcoin prices, soaring from about 95,000 USD to 99,000 USD.

In addition to supporting cryptos, Atkins has also criticized the banking regulatory policies after the subprime mortgage crisis, such as the Dodd-Frank Act imposing excessive burdens on the banking industry.

Editor/rice