So the Fed just cut rates again – quarter point, nothing fancy – and instead of markets doing their usual happy dance, they basically shrugged and went back to scrolling TikTok. Why? Because Jerome Powell had the audacity to suggest that maybe, just maybe, they won’t cut again in December.
Cue the dramatic gasps from Wall Street.
But here’s the thing that’s got me scratching my head: Why are we still pretending the Fed is the main character in this story?
The Old Playbook Is Broken
Look, I get it. For years, the Fed was basically the puppet master of markets. They’d hint at rate changes, and stocks would either moon or crater accordingly. It was simple. It was predictable. It was also… kind of boring?
But that playbook got tossed out the window somewhere around the time ChatGPT made everyone realize we’re living in the future. Now? AI is the new Fed, and it doesn’t care one bit about Powell’s press conferences.
Think about it: While everyone’s obsessing over whether rates go from 4.75% to 4.5%, Microsoft, Google, and Amazon are out here writing checks with more zeros than a lottery jackpot – all for AI infrastructure. Data centers, chips, power grids, the works. And here’s the kicker: they’re paying cash.
When You’re Rich Enough, Interest Rates Are Just Suggestions
These tech giants aren’t sweating over a few basis points when they’re sitting on mountains of cash and expecting decade-long returns on their AI investments. Powell himself basically admitted this, saying (and I’m paraphrasing): “Yeah, all that data center spending? Not really our thing to control.”
Translation: The Fed just confessed they’re not driving the bus anymore.
Meanwhile, traditional rate-sensitive stuff – housing, auto loans, small business credit – is looking pretty rough. But who cares when AI companies are printing money faster than the actual money printer?
The Fed Still Has Some Tricks
Don’t get me wrong, Powell & Co. aren’t completely irrelevant. They can still mess with valuations (higher yields = lower stock prices, basic math), and if they really screw up, they could break something important in the broader economy.
But right now? They’re more like that friend who thinks they’re DJ-ing the party when everyone’s already moved to the kitchen where the real conversation is happening.
The Bottom Line
The market’s center of gravity has shifted, and it’s not shifting back anytime soon. AI spending is the new economic engine, and it runs on strategic urgency, not interest rate policy.
So while everyone else is parsing Fed minutes like they’re ancient prophecies, maybe it’s time to focus on the companies actually building the future – the ones laying fiber, manufacturing chips, and powering the data centers that’ll run our robot overlords.
Because whether the Fed cuts in December or not, those billion-dollar AI checks are still getting written. And that’s where the real money is.