(The Epoch Times)—The Federal Reserve’s challenges extend beyond Chair Jerome Powell’s stance on interest rates, said Treasury Secretary Scott Bessent on CNBC’s “Squawk Box” on July 7.
President Donald Trump and senior administration officials have repeatedly criticized Powell for not lowering interest rates, given that inflation is hovering close to the central bank’s 2 percent target, and the labor market remains in a solid position.
The White House recently said the board also bears responsibility for not reducing the key policy rate earlier.
“A different Fed chair is a kind of forward guidance. But as I reiterate to people all the time, it’s not just the Fed chair. It’s a committee,” Bessent told CNBC.
Trump has expanded his criticisms to the Federal Reserve as a whole.
In a June 30 Truth Social post, the president stated that Powell and the board “should be ashamed” for not cutting interest rates.
“Jerome ‘Too Late’ Powell, and his entire Board, should be ashamed of themselves for allowing this to happen to the United States,” he said. “The Board just sits there and watches, so they are equally to blame. We should be paying 1 percent interest, or better!”
The Federal Reserve Board contains seven members. Each member is identified as a governor and appointed by the president, serving a 14-year term. The board is led by a chair, who serves a separate four-year term.
Powell was first appointed to the board by President Barack Obama in 2012 to fill a vacancy left by Frederic Mishkin and was elevated to chairman in 2018 by Trump.
Trump selected Michelle Bowman in 2018 and Christopher Waller in 2020. President Joe Biden chose Michael Barr (2022), Lisa Cook (2022), Philip Jefferson (2023), and Adriana Kugler (2023).
The president and his team have been laser-focused on choosing Powell’s replacement. The Fed chair’s term expires in May 2026, and Trump has stated that he has a few candidates in mind.
According to Polymarket, the betting markets have identified some of the favorites, including former Fed Gov. Kevin Warsh (21 percent), Bessent (19 percent), National Economic Council Director Kevin Hassett (13 percent), and Waller (11 percent).
That said, with Kugler’s term set to expire next year—she replaced Lael Brainard, who became National Economic Council Director in the Biden administration—Trump administration officials are also eyeing a board seat.
“There’s a seat opening up, a 14-year seat opening up in January. So we’ve given thought to the idea that perhaps that person would go on to become the chair when Jay Powell leaves in May, or we could appoint the new chair in May,” Bessent said in an interview with Bloomberg TV last week. “Unfortunately, that’s just a two-year seat.”
Powell’s term on the board expires in January 2028.
Trump, meanwhile, has confirmed that he will not appoint anyone who opposes cutting interest rates.
“If I think somebody’s going to keep the rates where they are or whatever, I’m not going to put them in,” Trump told reporters in June. “I’m going to put somebody that wants to cut rates. There are a lot of them out there.”
Voices at the FOMC
In a July 3 interview with CNBC’s “Squawk on the Street,” Bessent pointed to the policy divergence between Trump and non-Trump appointees.
“I’ll let you read into that what you want,” he said.
In addition to shaping policy, Federal Reserve governors are voting members of the rate-setting Federal Open Market Committee, or FOMC.
But while Bowman and Waller have expressed support for lowering interest rates sooner, they have supported keeping the benchmark federal funds rate—a policy rate that influences business, consumer, and government borrowing costs—higher for longer at the FOMC meetings.
Last month, the two Federal Reserve officials said they would favor pulling the trigger on a rate cut at the July FOMC policy meeting.
Others, meanwhile, have beaten the patience drum, arguing that monetary policymakers can be patient and wait for more data before taking action.
Kugler says the central bank should keep rates steady amid tariff-driven upside inflation risks.
“I see greater upside risks to inflation at this juncture and potential downside risks to employment and output growth down the road, and this leads me to continue to support maintaining the FOMC’s policy rate at its current setting if upside risks to inflation remain,” Kugler said in a June 5 speech at the Economic Club of New York.
The projected effects of the president’s tariffs have not yet materialized in the hard data. Powell recently told lawmakers on Capitol Hill that he expected them to start showing up in the June and July data.
Next week, the Consumer Price Index (CPI) will be released for June. The Cleveland Fed’s Inflation Nowcasting Model projected that the annual inflation rate will rise to 2.6 percent, and the monthly inflation rate will jump by 0.3 percent.
CPI figures for July are then expected to stall, rising 0.1 percent, according to the regional central bank’s model.
At a Council on Foreign Relations event last month, Cook reiterated that monetary policy is well-positioned to respond to a wide array of economic situations.
“There is evidence that changes to trade policy are starting to affect the economy,” Cook said.
New CME FedWatch Tool data show that investors overwhelmingly expect the central bank to leave interest rates unchanged in a range of 4.25 and 4.5 percent. The futures market is penciling in a quarter-point rate cut in September, which would be the first since December 2024.
Powell noted that if tariff-driven inflation proves to be a one-time price adjustment or less severe than expected, he and his colleagues would support lowering the policy rate—even as early as July.
“I wouldn’t take any meeting off the table or put any on the table. It depends on how the data evolve,” Powell said on a panel at the European Central Bank forum in Portugal on July 1.
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Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.
