Fed Chairman Jerome Powell Reveals All After Getting Pranked by Fake Zelensky

Rates to stay high for quite some time

Ukrainian “President Zelensky” had a nice chat with Federal Reserve Chairman, Jerome Powell recently. Apart from it wasn’t actually President Zelensky. Instead it was two Russian pranksters who recently pranked former French President Hollande. It seems the mere mention of the name “Zelensky” gets the rich and powerful lowering their guard and ready to spill the beans on any topic fake Zelensky requests.

The two Russians called Vladimir Kuznetsov and Alexei Stolyarov go by the name of Vovan and Lexus and have previously pranked Hollande, former British Minister of Foreign Affairs William Hague, Angela Merkel, 27th US Secretary of Defense Mark Esper, Christine Lagarde and many others.

A number of short videos were released in which “President Zelensky” sounds more like Sacha Baron Cohen’s “Borat”. But yet Mr Powell still falls for it.

“Zelensky” first butters the Chairman up by telling him he is “the wisest person in the world”. After that Powell was putty in the pranksters’ hands.

In one of the videos, Mr. Powell discusses the surprising labour shortage and says this is part of the reason why it is hard to get inflation down. He says we’re going to find the growth in 2022 was positive but modest - subdued - around 1%. 2023 forecasts suggest growth but at a subdued level - less than 1%.

The Chairman said that a recession is just as likely as very slow growth, partly because they have raised rates quite a bit. However, he sees it as necessary to get inflation down. Inflation is at its highest level in 40 years so to get this down they need a period of slower growth so that the economy, the labour market and wages can cool off. Powell says that is the only way they know how to bring inflation down. It can be painful but they don’t know of any painless way to do it.

Mr Powell said that any kind of negative event, e.g. a new Covid strain or a terrible event in Ukraine, will create a negative shock which will put the US economy into recession.

He thinks inflation will come back down to their target of two percent but it depends on what happens in Ukraine, Russia and China. According to Powell, there will be at least two more 1/4 percentage point rate hikes. After that they will look around and see if they should do any more and for how long they should keep rates high. Powell thinks rates will be kept high for quite some time.

When it came to Russian sanctions, Powell agreed that they have not been effective against Russia. He knows the head of the central bank in Russia and would be surprised if she supported the war. However, she is very smart and so would have done things with the government that would have enabled the Russians to not get hurt by the sanctions.

Because the United States has its own energy, they have not been affected by the sanctions but it has hit Poland and Eastern European countries.

None of the information is particularly surprising but it is still an interesting insight into what the head of the Fed thinks. What is disappointing is how infatuated western politicians/bankers are with Zelensky. So much so that it makes them easy targets as these pranksters have shown here.