Jerome Powell 'Is Going to War': Top Economist Wolfers Blasts DOJ As 'Department Of Recriminations' For Targeting Fed Chair - Invesco QQQ Trust, Series 1 (NASDAQ:QQQ), SPDR S&P 500 (ARCA:SPY)

Core Viewpoint - Economist Justin Wolfers warns of a significant conflict between the White House and the Federal Reserve, emphasizing that Chair Jerome Powell is actively defending the central bank's independence against political pressure [1][2]. Group 1: Federal Reserve's Position - Wolfers describes Powell's recent public address as a counter-offensive against executive pressure, indicating that Powell is no longer merely defending policy but is actively fighting back [2]. - The release of an unprecedented "evening video" by the Federal Reserve is highlighted as a direct challenge to the administration, with Wolfers stating that Powell is taking his case to the public [2]. Group 2: Criticism of the Administration - Wolfers criticizes the administration's attempts to "criminalize" the actions of the Fed Chair, labeling the Justice Department's involvement as the "Department of Recriminations" [3]. - He warns that yielding to political pressure would undermine the Federal Reserve's independence, potentially transforming it into the "Federal Subserve" [3]. Group 3: Broader Implications - The situation is framed as a constitutional crisis regarding monetary authority, with Wolfers asserting that the power to manage the money supply resides with Congress, not the President [4]. - He calls for Congressional action to prevent the President from overstepping his authority in monetary policy [4]. Group 4: Market Reactions - The CME Group's FedWatch tool indicates a 95% likelihood that the Federal Reserve will maintain current interest rates in January [5]. - The SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust ETF (QQQ) both closed higher, with SPY up 0.66% at $694.07 and QQQ up 1.00% at $626.70 [6].