Powell corralled the cats, says chief economist

Group 1 - JP Morgan has lowered its prime lending rate to 7.25%, typically a response to a Fed rate cut, indicating a downward trend in rates [1] - The Fed funds rate is currently at 4.08%, with projections suggesting it may end the year around 3.6% after two rate cuts, reflecting a gradual shift in monetary policy [1][18] - The Fed's dot plot reveals mixed opinions among members regarding future rate cuts, with one member advocating for five cuts, while others prefer no further cuts this year [1][18] Group 2 - The Fed is facing a dual mandate of maintaining stable prices (targeting 2% inflation) and achieving full employment, which are currently in conflict [2][14] - Job creation has significantly decreased, with new jobs dropping from 150,000 to 25,000 per month, prompting concerns about the labor market [3][22] - The Fed's recent rate cut is seen as a risk management strategy to stimulate employment amidst a deteriorating job market [4][16] Group 3 - The current economic environment shows a lack of widespread dissent within the Fed, with only one member opposing the recent decision, indicating a level of consensus [7][11] - The Fed's approach to managing inflation and employment is complicated by external factors such as tariffs, which could lead to price increases [26][30] - There is a notable disparity in economic recovery, with the top 20% of Americans driving the economy while the bottom 80% face stagnation, affecting overall inflation dynamics [31][32]