US Govt. Makes $8.9B Investment in Intel Stock | Balance of Power 8/22/2025

Monetary Policy & Interest Rates - The Federal Reserve (FED) is considering adjusting its policy stance, potentially cutting interest rates, influenced by recent data and a shifting balance of risks [3][4][5] - The market anticipates a rate cut as early as September 17th, interpreting FED Chairman Jerome Powell's remarks as a signal despite his attempts to hedge [5] - The FED's decision-making is complicated by a weakening labor market and inflation, with the immediate danger perceived to be in the labor market [5][6] - The FED aims to keep consumer inflation expectations anchored around a 2% target, a challenge given recent performance and the impact of tariffs [18][19] - Political pressure on the FED raises concerns about its credibility and independence, potentially clouding decision-making [15][16] Trade & Tariffs - The U S government is actively intervening in trade, exemplified by Intel agreeing to give the U S a 10% equity stake [2][8][10] - Canada is removing retaliatory tariffs on U S products compliant with the USMCA deal, signaling a potential improvement in trade relations [26][27][29] - The U S continues to impose Section 232 tariffs on strategic sectors like steel and aluminum, impacting trading partners including Canada [31][32] - Tariffs are creating uncertainty in the market, making it challenging to disentangle their effects on inflation and keep inflation expectations anchored [22][23] Geopolitics & Security - The U S President is giving Russia a two-week deadline to come to the table regarding the war in Ukraine, threatening sanctions if no progress is made [51][52] - The U S is considering security guarantees for Ukraine, with discussions around an Article Five-like agreement or NATO membership [59][60][61] - China is closely watching the situation in Ukraine and may attempt to distract or create confusion through actions against Taiwan or NATO allies [63][64] Company & Government - The U S government is considering taking a 9 9% stake in Intel, potentially increasing to almost 15% once fully vested, in an unorthodox deal valued at approximately $11 billion [10][48][49] - NVIDIA is instructing producers to stop production on an intelligence chip, after Beijing urged local companies to avoid using the H20 chips [71] - The FBI raided the home of former National Security Advisor John Bolton, potentially linked to classified documents [72]