TWEEDLE TIMES—President Trump tested the markets yesterday by floating rumors of firing Fed Chair Jerome Powell. The reaction was swift.
The VIX (Fear Index) ripped over 10 percentage points, the dollar crashed 1 and long-term treasuries spiked toward the moon.
Trump squashed the rumor about an hour later and markets reset, finishing the day in rally mode.
[VOLATILITY VIX \(FEAR\) INDEX](https://preview.redd.it/ur54buepsedf1.png?width=843&format=png&auto=webp&s=6861d8f884c7b4a5627f278a79f7cb97db7e3891)
[US DOLLAR PRICE ACTION](https://preview.redd.it/2c365dh8sedf1.png?width=872&format=png&auto=webp&s=f915c1452fd58c7c07c6beddde927f3ebe25e44b)
[30-YEAR BOND](https://preview.redd.it/l2by9uy2uedf1.png?width=827&format=png&auto=webp&s=1491158a330433b0fa8d42e44c49848654febd5a)
The real-time experiment proved markets prefer an independent Federal Reserve versus a banana-republic currency and bond market that’s controlled by the White House.
In other news, crypto currency cleared major hurdles in Washington yesterday as three crypto bills inched closer toward the finish line. If passed into law, Stablecoin will become the first digital currency backed by the US dollar/Federal Government.
Lawmakers also approved $9 billion in cuts to defund the Corporation for Public Broadcasting, which had long hosted public news and the flagship children’s program *Sesame Street* since 1969. The program has since moved to Netflix.
The move is in response to an executive order President Trump signed in April to slash public subsidies to “bias” news organizations. A White House social media post announced the order saying these news organizations “receive millions from taxpayers to spread radical, woke propaganda disguised as ‘news.’”
Wall Street equity futures on Thursday were flat and bonds were slightly elevated, indicating that for now, investors are compartmentalizing recent events as another Presidential head fake. Crypto markets are poised for liftoff.
The next major market catalyst is expected to come today when Netflix reports earnings after the bell.