Jerome Powell has taken a lot of abuse over the past few years. The Federal Reserve chairman was blamed for mischaracterizing the rise of inflation as “transitory” in 2021, a move that led him to keep interest rates near zero well into the post-COVID recovery. And even after Powell admitted he had miscalculated inflation’s trajectory, leading him to walk back that “transitory” line and turn to interest rate hikes to fight consumer price increases in March of last year, he couldn’t get the critics off his back. A new group emerged who argued the Fed chair was being too aggressive with his rate hikes and could end up sending the economy into recession. But now, Jefferies’s chief market strategist David Zervos—who has stood by Powell over the past 18 months—is taking a victory lap amid the economy’s resilience, branding the Fed’s critics “Jay-haters” and “Armageddonistas.” He’s even composed a “Dear Jay” apology letter template for their convenience.
Criticism of Powell was especially pointed earlier this year after regional bank instability, headlined by the collapse of both Silicon Valley Bank and Signature Bank, ensued in March. University of Pennsylvania professor Jeremy Siegel, along with Yale’s Jeffrey Sonnenfeld and Steven Tian, argued in a March Fortune op-ed that “shrapnel” from the Fed’s rate hikes “killed” SVB and “may send the economy into recession in the process.”
