The Fed Chair Didn't Blink — And Now 3 Markets Are Reacting at Once

Jerome Powell walked into a room full of tension on Tuesday — and walked out without blinking.

The Federal Reserve Chair gave a speech in Chicago that sent a clear message: **no rate cuts are coming just yet**, and the reason is one word you've heard a lot lately — tariffs.

Powell said the new round of tariffs announced by the Trump administration are "larger than expected" and could push inflation higher while simultaneously slowing economic growth.

That's a nightmare combination for a central banker.

It's called stagflation — prices go up AND the economy slows down — and it's one of the hardest problems any Fed chair can face.

Trump did not take the news quietly.

Within hours, the President posted on Truth Social that Powell is "always too late and wrong" and repeated his calls for the Fed to cut rates immediately.

"Powell's termination cannot come fast enough," Trump wrote — **the most direct threat yet** to a sitting Fed chair's job security.

Here's the thing: Powell has said publicly he won't resign if asked. And legal experts told the previous briefing that firing him outright would be unprecedented and legally contested.

But the market didn't wait for a legal opinion.

The Dow dropped more than 900 points. The S&P 500 fell nearly 3%. Gold surged past $3,400 an ounce — a historic high — as investors moved toward safe-haven assets.

**The message from Wall Street was blunt**: uncertainty about who controls the Fed is as dangerous as any tariff.

Meanwhile, the Harvard standoff took a new turn.

The Trump administration moved to freeze another $450 million in federal grants to the university — on top of the $2.2 billion already frozen — after Harvard refused to end its diversity programs and submit to federal oversight of its admissions process.

Harvard filed a lawsuit in federal court on Monday. Now both sides are waiting for a judge to decide whether to grant an emergency injunction that would temporarily unblock the funds.

**This has become the most high-stakes legal showdown** between a university and the federal government in modern American history.

On the trade front, new signals emerged that China and the U.S. may actually be talking — quietly, behind the scenes — despite Beijing's public insistence that no negotiations are underway.

Reports cited unnamed officials who said **lower-level technical discussions have begun**, even as the two countries maintain a combined tariff load of over 145% on each other's goods.

You might wonder: if talks are happening, why won't either side admit it?

Because the first side to publicly say "we're negotiating" is the side that looks like it blinked.