New Federal Reserve Chair Powell Debuts: No Rate Cuts Yet, Investors Are Already Going Crazy

After Powell officially confirmed his appointment as Fed Chair, the U.S. stock market immediately entered an "imagination rally."
The most classic scene appeared: even though the officials haven't announced any rate cuts, the market has already started celebrating the "new era of liquidity." Wall Street analysts collectively switched modes, from "recession warnings" to "soft landing experts."
This is the most magical part of the capital market — it always pre-consumes the future.
Powell's style is considered to focus more on market stability. Simply put, if the market falls too hard, he might not watch coldly like an extreme hawk. Who prefers this style the most? Of course, high-valuation tech stocks.
So AI concept stocks are starting to "come back to life." Many stocks have P/E ratios as high as science fiction novels, but investors don't care at all. Because everyone believes that as long as the Fed slightly loosens in the future, funds will continue to flow in.
But reality isn't so fairy-tale-like.
U.S. inflation now is like an indestructible cockroach. When energy prices rise slightly, prices jump along with it. Consumers are already fed up with high interest rates, with credit card interest rates so high that young people are starting to nostalgic for "cash payments."
The biggest challenge for Powell now is balancing both sides.
On one side, the capital market is shouting every day: "Cut rates quickly!"
On the other side, inflation data reminds: "You better not mess around."
If actions are too slow, the market will fall; if too fast, inflation might revive. The role of the Fed Chair, in essence, is the world's most expensive "high-pressure balancing beam."
What's more interesting is that the whole world is watching. Europe hopes the U.S. will loosen early, Japan keeps an eye on the dollar exchange rate, and emerging markets are waiting for capital to flow back. It can be said that one word from Powell can cause global fund managers to change strategies overnight.
Many people think the Fed only manages the U.S., but in fact, it’s more like a global financial weather forecast. As soon as Powell takes the seat, the whole world begins to guess: will the next storm be a downpour or the next bull market?