Odd Lots Adam Posen on a Surreal Jackson Hole in a Post-American World
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Aug 26, 2025 
In this engaging conversation, Adam Posen, President of the Peterson Institute for International Economics and former member of the Bank of England's Monetary Policy Committee, delves into the surreal atmosphere of the Jackson Hole symposium amidst attacks on Fed Chairman Jerome Powell. He discusses the threats to central bank independence and critiques Trump's trade policies. Posen also addresses the complexities of tariffs and their impacts on U.S. manufacturing, inflation, and global credibility, shedding light on the evolving economic landscape.
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Credibility Is About Being Allowed To Act
- Attacks on the Fed threaten not just credibility but the ability of the Fed to deliver policy outcomes.
- When fiscal power can overpower monetary policy, long rates rise and the dollar weakens.
Dollar Losing Its Safe‑Haven Correlation
- The dollar's traditional safe-haven role has visibly reversed since April 1.
- Treasury yields rising while the dollar falls looks like emerging-market behavior and signals reduced trust.
America As The World's Insurance Provider
- The US acted as the global insurer after WWII, providing security, standards, and a stable dollar.
- That role produced substantial economic benefits, lowering financing costs and spreading influence.
