Weekly Wrap: A chair you can’t sit on, a boom you can’t hide, and a saint you can’t burn.
Welcome to Friday. This is the TotalNews Weekly Wrap, which typically wraps up the week but will be extended for an unspecified time to safeguard the independence of the newsletter policy. It’s the foundation of our economy.
Jay Powell said this week that while you can take away his role as Fed chair, you can’t take him away from the Fed. The biggest story for 2026—the resurgence of America’s manufacturing sector—is starting to emerge. The stock market seems to be favoring bullish sentiment, especially for those previously deemed bearish.
Powell’s FRB 4-Eva!
It feels like Jay Powell still finds ways to shine. At least for a few more months. The outgoing Fed chair has indeed done something unprecedented by choosing to stay on the Fed Board and the Federal Open Market Committee, which, frankly, remains a bit ambiguous. In his own words, it’s “undetermined.”
Powell’s governor term ends in January 2028, though one wonders if he’ll want to stick around that long. Once he gets a taste of being chairman, wouldn’t he realize being on the Fed Board is more rewarding? If Kevin Warsh takes over, let’s hope Powell gets his due respect. But is it really so wrong to keep Powell around? Should I dread it or just find a better parking spot? What are the local birds thinking?
Mr. Powell asserted he’d remain in his position to uphold institutional independence rather than out of any personal bias against Trump, but that’s hard to buy. Every current Board member and Fed Governor shows steadfast support for the Fed’s autonomy. Why is Mr. Powell so critical? If Mr. Trump wanted to nominate him, Senate approval is needed, and the Tillis-Pirro scandal showed the Senate wouldn’t risk the Fed’s independence.
Mr. Powell seems to embody what is known as “Protagonist Syndrome.” He appears convinced that this narrative revolves around him. The Fed’s future and the broader U.S. economy seemingly hinge on his decisions. This mindset might actually warrant some reform to limit the chair’s clout. After all, much of the last six years, particularly Joe Biden’s inadequate response to the Green New Deal spending, has been swayed by Powell’s influence. It’s unfortunate that this has fostered a sense of self-importance.
Our guess is Powell will stick around until the Supreme Court rules on the Lisa Cook situation. He was the Fed director Trump aimed to oust last year, yet Powell supported his retention. It’s quite possible he’ll remain until after the midterm elections, hoping his successor gets confirmed by a Democratic-controlled Senate.
Unbeknownst to him, Powell’s likely underlying motive is to shape his legacy. His chairmanship has not been without significant blunders, some quite severe. Powell has presided over more ethics scandals than any previous Fed leader, as seen in the number of departures. During Trump’s first term, he seemingly overcorrected because analysts thought the economy was overheating. He endorsed average inflation targeting, which backfired and helped create ongoing inflation issues. By keeping rates too low for too long, he mirrored Biden’s spending plans. He once claimed inflation was a temporary issue and lowered rates just before the 2024 elections.
It’s not exactly a stellar record. Certainly not something you’d want your grandchildren to see in a U.S. history textbook. Consequently, Powell seems to want to reframe his Fed journey as a valiant defense of central bank independence against Trump. A more reliable historian would likely view this as a self-serving narrative.
U.S. Manufacturing Boom
Just last week, reputable sources began acknowledging what they termed a hidden or shadow manufacturing boom in the U.S. This week, it finally surfaced. Orders for durable goods increased by 0.8%, surpassing the predicted 0.5%. Core capital goods rose by 3.3%, and new orders for electronic equipment climbed by 3.7%.
Recent first-quarter GDP figures revealed a manufacturing boom as well. The rate of private investment in non-residential capital surged at an annual rate of 10.4%. Among fixed investments, capital investment rose by 17.2%, and intellectual property investment increased by 13.0%.
This surge is closely linked to the growing use of AI. Still, we shouldn’t overlook the impact of Trump’s policies—particularly the economic nationalism they inspired. His tax cuts, particularly the full depreciation rule, have created a fertile ground for this investment surge. His tariffs encouraged companies to favor domestic production, utilizing American-made materials and labor. Concerns about national security and a delayed recognition of the importance of local production for long-term investment security also contributed. Many American firms have finally acknowledged the risks associated with relying on Chinese manufacturing.
The old saying from Field of Dreams asserts: If you build it, they will come. Under Trump’s leadership, we are indeed building it again, rekindling the spirit of American economic supremacy that has long been dormant.
April Is Tough for Bears
Many still regard the U.S. economy with skepticism. Of course, the bears aren’t exclusively TDS liberals, but they suspect the Iran war signals economic doom. This argument isn’t without merit. Higher energy prices can drain consumer spending. Consumer confidence dipped even before the war and the closure of the Strait of Hormuz. Employment is uncertain, although we’ve technically achieved full employment, so it doesn’t feel overly concerning.
Still, we kept reiterating our mantra: People who panic always lose money. Much to our advantage, the market made its stance clear. April was the best month for stocks since the vaccine announcements in 2020. On May 1, the S&P reached a new record, while the Dow Jones hit an all-time high. This isn’t a fleeting, unsustainable trend; corporate earnings remain strong, and future forecasts look promising. As our friend Larry Kudlow often says, profits are vital for stocks.
To protect identities, let’s skip mentioning names here. But really, everyone, it’s time to shed your bear suits.
Upcoming Commemoration
This Monday, we honor Saint Florian’s Feast, a Roman soldier credited with setting up a fire brigade in Noricum, now known as Austria. He was martyred during Diocletian’s rule around 304 AD. Legend has it that he once doused a raging fire with just a bucket of water. He became the patron saint of firefighters in the 12th century, with May 4th chosen as International Firefighters Day in his memory.
In Quincy, Massachusetts, there’s a legal dispute surrounding the commissioning of two 10-foot bronze statues of St. Florian and St. Michael the Archangel (the patron saint of police officers) for the new $175 million Public Safety Building. However, while public funds state “In God We Trust,” local officials aren’t allowed to publicly confirm religious themes. Mayor Thomas Koch, a devout Catholic, chose these figures to honor first responders, though this intention may be misunderstood.
The ACLU of Massachusetts swiftly contested the plan, prompting a state court to halt the statue’s installation. The judge ruled against the statues, arguing that placing images of saints on public buildings could imply establishing a national religion. So now, the statue is stored away somewhere outside Boston, with hopes that either the Massachusetts or the U.S. Supreme Court will intercede.
St. Florian was a soldier who ran through flames in the name of a higher authority. When Diocletian learned that Florian refused to kill Christians, he sent the governor Aquilinus to investigate. To test Florian’s faith, Aquilinus ordered sacrifices to Roman gods. Florian publicly declared himself a Christian, leading to a brutal sentence: he was beaten and sentenced to death by fire. When his soldiers hesitated to start the fire, Florian urged them to be brave, stating he would ascend the flames to heaven. The governor, not grasping the concept of ascension, meted out further cruelty against Florian.
It appears Quincy should be free to honor those rushing toward danger—represented by a bronze statue of St. Florian. The ACLU’s opposition serves as a reminder of the ongoing struggle against the very forces represented by Diocletian and Aquilinus.
