Forbes Magazine Gets It Wrong: Neither Xi, Putin, Trump, Nor Jerome Powell Is the Most Powerful Person on the Planet

Sep. 20, 2019
Bob Adelmann

Forbes has it all wrong. Their top three most powerful people on the planet are, in order, Xi Jinping, Vladimir Putin, and Donald Trump. Some think the chairman of the Federal Open Market Committee of the Federal Reserve, Jerome Powell, should head the list. Forbes puts him at position No. 11.

Powell is the head of the central bank of the largest economy in world. The dollar is the world's reserve currency. Nearly every other currency is pegged to the dollar. Even oil is priced in dollars. A quarter-point move in interest rates reverberates across the globe.

And so, when the big dog speaks, Wall Street breathlessly waits to hear the latest announcement from on high. What they heard on Wednesday was a man, simply a man, a human being, trying to be transparent and coming across as weak and unsure:

There will come a time, I suspect, when we think we've done enough [cutting of interest rates]. But there may also come a time when the economy worsens and we would then have to cut more aggressively.

We don't know.

Jerome Powell, as head of the central bank of the largest economy in the world, doesn't know?

He explained:

It's an unusual situation. Our eyes are open. We're watching the situation….

We are going to be highly data-dependent … we are not on a pre-set course. We are going to be making decisions meeting by meeting.

His council of advisors – the 17 gurus sitting on the FOMC (only 10 of whom have votes) – disagree with the proper course of action in light of that "unusual situation." Seven of them are expecting a third rate cut this year, by another quarter of a point, while five think there will be none before the end of the year. And five of them were opposed to cutting rates this time.

The analogy of the little boy playing with his brand new chemistry set is apropos: mixing the wrong ingredients could blow up in his face.

Rex Nutting, the Wall Street observer for MarketWatch for more than two decades, agrees:

Fed Chair Jerome Powell doesn't know the answer, he knows he doesn't know, and he knows you know he doesn't know. So quit asking.

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The list of what Powell doesn't know is staggering: he doesn't know what's happening in the economy. He doesn't know if a recession is coming. He doesn't know if his council of advisors will be able to react in time if one does show up. He doesn't know if investors should buy stocks or sell them. He doesn't know if people should buy a new home or refinance their present one and just stay put. He doesn't know if business owners should expand or sit tight. He doesn't know how the trade war between the president and the communists running China will turn out.

And yet, he doesn't know and he knows that you know that he doesn't know and he wants you to quit asking and just let him and his people run the show?

Added Nutting:

Don't pay any attention to our forecasts [either] … because we really don't know what will happen next. We have no faith in our forecasts, and neither should you.

It turns out that the best person to answer those questions isn't Powell after all, but the American consumer. And by nearly every metric he is one happy camper. He is spending more for new cars and trucks in greater numbers than ever in history. US retail sales in August rose 0.4 percent from a month earlier, which rose 0.8 percent in July over June, far exceeding forecasters' expectations. US homebuilding surged to more than a 12-year high in August while building permits jumped to their highest level since May 2007. Reports from the Mortgage Bankers Association showed that applications for mortgage loans continue to increase.

But of the smartest 17 people on the planet – the members of the FOMC – seven of them are "penciling in" (as the Wall Street Journal expressed it) at least one more rate cut by the end of the year while the other 10 are split between leaving them alone and objecting to Wednesday's quarter-point cut.

So, the Federal Reserve is being run by people with fancy degrees in economics from elite Ivy League schools based on majority rule?

It's probably not helpful to remember that a camel is a horse designed by a committee. It's also not helpful to remember the announcement from the pilot of a commercial airliner who told his passengers: "We've lost our radar and we don't know where we are. But we're making great time."

Missing altogether from Forbes' list is the most powerful person in the world: the American consumer.


An Ivy League graduate and former investment advisor, Bob is a regular contributor to The New American primarily on economics and politics. He can be reached at


Forbes: The World's Most Powerful People Why is oil priced and traded in U.S. dollars? Fed approves quarter-point rate cut but is divided on further action this year

The Wall Street Journal: Fed Cuts Rates By Quarter Point but Faces Growing Split Fed Cuts Interest Rates, Signals Holding Pattern For Now

Rex Nutting's Opinion: In a time of Trump, the Fed doesn't know what's going to happen next

Reuters: U.S. housing starts, building permits scale 12-year high

Background on Rex Nutting

U.S. Retail Sales

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