Back Research Notes Trump Floats The Powell Firing Trial Balloon Published on July 20, 2025 By Jordi Visser In this week’s video ( Trump Warns Market: Be Ready For Powell Firing ), I cover a turbulent week in markets driven by a potential challenge to Fed independence. Trump’s rumored plan to fire Jerome Powell sent signals through bonds, stocks, and the dollar, reviving fears of fiscal dominance and the politicization of monetary policy. I explore why in my opinion, Fed independence has already been disrupted whether Powell finishes his term or not. The labor market is weakening beneath the surface, why rate cuts are still likely, and how inflation may return via growth, not stagflation. I connect this view to the broader global macro framework of AI-driven manufacturing growth, energy bottlenecks, and the reshaping of the U.S. economy around infrastructure and data centers. The episode also highlights a landmark week for crypto policy in the U.S., with three major bills passed in the House, fueling breakouts in Ethereum and XRP. AI’s insatiable compute demand is running into a wall of energy scarcity, and Eric Schmidt’s insights frame why electricity, not chips, is now the limiting factor. I share why this is bullish for energy, industrials, and power utilities, and explains how investors should shift focus from software to physical infrastructure. I spotlight strong data center-related earnings from ABB and Legrand, and a major shift in China toward high-tech industrial output despite weak consumer data. Timestamps: 00:29 – S&P consolidates at highs, but yields rise on long end → Market pricing in 5 rate cuts by 2026 despite no recession in sight 02:01 – CPI comes in light again; Trump pressure on Powell intensifies → Trial balloon floated about firing Powell to boost housing and growth 03:39 – Can the Fed stay independent? Fiscal dominance narrative builds → Trump’s shadow Fed and political influence may already be here 05:24 – AI changing labor market dynamics, weakening confidence → Big firms slow hiring, startups lean on AI, raising job security fears 09:44 – Eric Schmidt: AI’s constraint is electricity, not chips → U.S. needs 92 gigawatts of new power—equivalent to 92 nuclear plants 16:00 – AI infrastructure boom echoes China’s urbanization wave → $90B Pennsylvania initiative underscores public-private AI capex cycle 34:44 – Crypto breakthrough: market structure, stablecoin, CBDC bills → Ethereum and XRP rally, $4T crypto market cap in sight 36:20 – Bitcoin breakout thesis: wave count targets $130K+ → Trump: Bitcoin could be biggest tech since the internet 38:37 – China’s AI and industrial boom masked by weak retail → Massive growth in 3D printing, lithium, robotics, new energy vehicles 31:15 – Inflation swaps rising, value rotation incoming → Energy > Tech trade setting up as PMI revision cycle kicks in Watch here