Seeds of Wisdom RV and Economics Updates Tuesday Evening 10-14-25

EconomicsNews

Oct 14

Good Evening Dinar Recaps,

Powell Hints at a Turning Point: Are the Days of High Rates Numbered? Today

In his NABE speech, Powell struck a more explicit tone than in recent speeches, tentatively flagging balance sheet limits, labor risks, and a path toward easing, without breaking precedent.

A More Direct Tone Than Before

On October 14 at the National Association for Business Economics conference in Philadelphia, Fed Chair Jerome Powell delivered remarks that went beyond what he said on October 9. He acknowledged that the U.S. economy “may be on a firmer trajectory than expected” while warning that the labor market remains weak.

Key elements from his speech:

He emphasized the tension between inflation pressures and employment weakness.
He signaled that the Fed may be getting close to pausing the shrinkage of its balance sheet (QT), citing signs of tightening liquidity such as firming repo rates.
He reinforced that future decisions will be meeting by meeting, relying on evolving data rather than committing to a pre-set path.

While his statements were more explicit than in his earlier community banking remarks, he avoided making any firm promises: no guaranteed rate cuts, no specific timeline, just cautious openness.

Was It More Encouraging for Americans?

Yes — but with important caveats.

What makes it more encouraging:

Clarity on balance sheet limits: The notion that quantitative tightening may be nearing its end suggests the Fed is preparing to transition from contraction to neutrality or gentle accommodation.
Recognition of labor fragility: By highlighting weak hiring, Powell shows awareness that policy must consider real economic stress, not just inflation metrics.
No rush but openness: The meeting-by-meeting approach suggests flexibility, leaving the door open for rate cuts if conditions warrant.

What limits the encouragement:

Delayed economic data: Because of the government shutdown, many key reports (jobs, CPI) are delayed. This “data blackout” makes it harder for any Fed signal to be decisive.
Inflation remains a threat: Powell continues to balance the risks of inflation getting out of control against supporting growth — the trade-off remains delicate.
No commitment to cuts: He didn’t promise rate cuts or quantify how close the Fed is to easing. The language remains conditional.

This speech is more overt than in recent days in signaling potential easing, more grounded in macro realities, and thus relatively more reassuring for Americans — but still cautious and noncommittal.

How It Aligns with our Changing Financial System

“This is not just politics — it’s global finance restructuring before our eyes.”

Monetary policy as geopolitical instrument: Powell’s handling of balance sheet, interest rates, and liquidity is not just economic — it’s a component of U.S. financial power in a global system under stress.
Subtle shifts matter: The move from tightening to signaling the end of QT is a behind-the-scenes recalibration of how money is deployed in markets — structural change in motion, not in obvious stunts.
Capital flows & dollar posture: As the U.S. adjusts, global investors and rival blocs (e.g. BRICS) can respond. Rate cuts or easier liquidity could weaken the dollar, shift yield arbitrage, and accelerate global rebalancing.
Policy legitimacy under pressure: Powell defended past bond purchases and institutional tools amid political criticism. That interplay underscores how even technical policy is a battleground in global finance.

In sum: the speech is a clearer signal of internal recalibration in U.S. monetary machinery — one small pivot in a larger transformation of global financial order.

What to Watch Next

Upcoming jobs & inflation reports (once the shutdown ends) — they’ll test whether Powell can follow through.
The Fed’s October meeting (Oct 28–29) — markets will see whether the subtle signals turn into action.
Reactions from regional Fed presidents and governors — to see where internal alignment is heading.
Global market flows and yield curves — how U.S. policy tilts might shift capital across borders.

Seeds of Wisdom Team
Newshounds News™ Exclusive

Sources:
• Reuters — Fed’s Powell says economy may be on firmer footing, but job market weak Reuters
• Reuters — Fed’s Powell says end of balance sheet drawdown may be nearing Reuters
• Reuters — Fed addresses economy pulled between growth, jobs, prices Reuters
• Investing.com — Powell signals QT may end soon Investing.com
• AP News — Slowdown in U.S. hiring suggests the economy still needs rate cuts, Powell says AP News
• Axios — Powell defends bond purchases amid criticism Axios
• Investopedia — Powell Keeps Door Open for Rate Cuts Investopedia
• Reuters — Economists see stronger U.S. growth, weak job gains, stickier inflation Reuters

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BRICS Currency Backed by Gold and XRP Shows Impressive Progress

BRICS nations are advancing toward a gold-backed currency system utilizing XRP, signaling a significant shift in global financial dynamics.

Key Developments in BRICS Currency Initiative

Central Bank Engagement: BRICS central banks, alongside the New Development Bank, have been actively developing the XRP Ledger for years, focusing on features like escrow and automation to facilitate cross-border payments.
Brazil's Involvement: Brazil's central bank has published papers specifically naming Ripple in its tests of distributed ledger systems, and private sector projects in Brazil are already utilizing XRPL for tokenization and financing.
Russia and China's Strategy: Russia is working on tokenizing its gold reserves, while China is expanding its gold holdings to support a future financial system.

Global Implications

De-Dollarization Efforts: The BRICS initiative aims to reduce reliance on the U.S. dollar by creating an alternative financial system that leverages gold and XRP.
Enhanced Trade Efficiency: Utilizing XRP's fast and cost-effective transaction capabilities, BRICS nations seek to streamline trade settlements across multiple payment corridors.
Geopolitical Shifts: This move represents a strategic alignment among BRICS countries to assert greater control over their financial systems and reduce vulnerability to external economic pressures.

Interpretation: A Quiet Revolution in Global Finance

The BRICS nations' shift towards a gold-backed currency system utilizing XRP signifies a deliberate and coordinated effort to establish a financial framework independent of traditional Western-dominated systems. This development underscores a broader trend of de-dollarization and the pursuit of financial sovereignty among emerging economies.

Why This Matters

This is not just politics — it’s global finance restructuring before our eyes.

The integration of XRP into a gold-backed BRICS currency system represents a significant departure from conventional financial structures. By leveraging blockchain technology and precious metals, BRICS nations are crafting a resilient and efficient alternative to existing systems, potentially reshaping global trade and economic alliances.

Seeds of Wisdom Team
Newshounds News™ Exclusive

Sources: