The One Line in Powell’s Speech That Should Have Tanked the Markets—But Didn’t

June 03, 2025

Last night, Jerome Powell gave a speech at the Fed’s 75th Anniversary Conference.

It sounded like a formality. It wasn’t.

Buried deep in a sea of academic pleasantries was one line that revealed exactly how fragile the dollar’s dominance has become:

“It remains critical that the Fed understand the policies and practices of other governments and central banks and their implications for the U.S. economy and for financial markets.”

Translation:

The Fed isn’t leading anymore.

It’s watching. Reacting. Hoping not to get blindsided.

For decades, the dollar dictated global behavior.

Now? The dollar adjusts to global behavior.

And nobody noticed.

This is what decline sounds like

It doesn’t start with a crash.

It starts when the people in charge admit—softly, carefully—that they’re no longer in control.

If Powell had said:

“We’re tracking China’s monetary strategy to avoid dislocation.”

Or:

“Our policy depends on Europe’s rate stance and Asia’s capital flows.”

Markets would’ve flinched.

But wrap it in mild language—“critical to understand other central banks”—and it slides under the radar.

Except it shouldn’t.

Because this is how reserve currency decay actually works:

  • Gradually

  • Without ceremony

  • Hidden in plain sight

Why this line matters more than any rate decision this year

The Fed just admitted its domestic policies are now shaped by external forces.

That means:

  • The U.S. can’t control inflation like it used to

  • Capital can (and will) flow to alternative systems

  • The illusion of independence is fading—and with it, dollar supremacy

The most important economic event last night wasn’t Powell’s speech.

It was the absence of reaction to what he said.

Nobody rang the alarm. So here it is:

When the Fed begins adjusting to the world instead of shaping it, you’re not living in an empire.

You’re living in a former one.

And if you think that’s just rhetoric?

Just wait until the next rate shock comes from outside our borders.

Because the dollar doesn’t lead anymore.

It listens.

Until next time,
—Death of the Dollar