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[00:03] starts right now. >> Hey I'm Cramer welcome to Mad Money. Welcome to Cramer. I'll do my friends I'm just trying to make a little money. My job not just to entertain but to educate. Teach it. Call me one [00:36] 873 CNBC's Jim Cramer. Maybe you hate Jay Powell. Maybe you love him. Maybe you have no idea who he is, regardless of what you need to know is that he's in charge of the Federal Reserve, so he controls what's known as short rates. That means the short term interest rates there are like the ones you borrowed today and pay you back tomorrow. [00:55] The president appoints the head [00:56] of the Federal Reserve. And in this case, it was President Trump who hired Powell during his first term. Trump now thinks Powell is doing a terrible job because he won't cut interest rates. So the president takes jabs at him every chance he gets. Unfortunately, this presidential obsession has a lot of impact on the markets today, for example, we got hit on rumors that Trump will fire Powell, and then the market came back when the president said it's not true. Dow only gaining [01:21] 231 points, has to be advancing [01:22] 0.32%, Nasdaq climbing 0.2 5%. Now, I thought the sell off on the rumor and the sharp rally on the news of the president letting Powell alone was dispositive. And I'm going to tell you why the president wants Powell out. But when we got a [01:37] whiff of the rumor that he'd [01:39] take action longer term, [01:41] interest rates went up with the [01:42] sacred 30 year Treasury going [01:45] from 4.97% to 5.07. Now, that's done in an hour. I know it's small, but you know the direction. The direction is for [01:52] interest rates to go higher. Bad. At the same time, the S&P 500 went from 6254 to 6201 on the rumor, but then rallied back to six two, six three after the denial. Good. So clearly the stock and bond markets don't want Powell getting ousted. [02:08] Isn't that that's not right [02:09] there. Boom. Now is Powell. The issue here is that the Wall Street's terrified of the idea that the president might be able to fire the fed chief, something he's not supposed to be able to do legally. He doesn't have the authority. But the Republicans [02:23] control all three branches of [02:23] government right now. Trump's the guy. Of course, there are still institutions that are concerned about Federal Reserve independence, but they're financial institutions, not political ones. The financial institutions don't have as many divisions as the political ones, and they never will. What is rarely talked about is why Powell even bothers to stay. [02:40] What's the point of taking this [02:41] now? As someone who's had his share of national ridicule, it's not something you look forward to. But when you look at the action in the stock and bond markets today, how we went down when the rumor was first floated, went up when the president walked it back. It's worth asking why stocks didn't soar when we thought Powell was getting fired. Soar. Stocks are [02:58] supposed to benefit from lower [03:00] interest rates, right? You cut rates, you get better business formation. You get stronger employment. Housing market gets stimulated by teaser rates. So why didn't stocks blast off? [03:08] When we heard Powell, who is [03:10] standing in the way of all that [03:12] was was sacked, why didn't why [03:14] did the market go up? Good question. One that I think the president has to be pondering. But therein lies the problem. The market, at least today, is saying that Trump might be very wrong about firing Powell. [03:26] What's the case for firing this [03:27] man? We spoke to presidential adviser Peter Navarro last week, and he thinks a good reason to fire him is that he's got a terrible track record. According to Navarro, 2018 Powell took rates up in the face of incipient weakness. 2021 he didn't take rates up because he thought that inflation was transitory. I'll admit that Powell is not perfect. Nobody [03:44] bats 1000. But we have to ask, should we judge him harshly for holding rates steady right now? Or to put it another way, why hasn't Powell started cutting rates again? We had a cooler than expected PPI number today that could make it easier to justify a rate cut, right. But how about inflation? The [04:03] incredibly important consumer [04:04] price index from yesterday had [04:05] some prices that had some signs [04:07] of inflation from the [04:08] president's tariffs, higher [04:09] prices for clothing, furniture, [04:11] cleaning products, food away [04:12] from home, meats, poultry, [04:13] coffee, gasoline, even soft [04:15] drinks. That's a long list. Now is the tracing right? Appliances and canned fruits and vegetables went up because of tariffs for certain. We know that from ConAgra that the price of tin cans went higher. Tariffs on [04:26] aluminum cans, including soda [04:26] cans, more expensive Korean and [04:28] Chinese appliances, went up in [04:29] price because of that steel [04:30] tariff. That helps give whirlpool an edge, but it hurts you because you have to pay more coffee imported. So the fall of the tariffs meat and poultry. That's more problems with do the herds and flocks furniture to move out of China raise prices. Same thing with clothing. [04:44] Tariffs are the issue against [04:46] all this though if you know [04:47] where to shop. Not something that they put in these numbers. Amazon Walmart Costco the prices are tame. Come on score one for the president. However, we don't know how high the tariffs are going to go and he seems to roll out new ones every day. We don't [05:02] know if there's going to be [05:04] doubling or tripling in some [05:05] countries. We haven't seen the car and truck tariffs that we all fear. We haven't seen how much the important parts of a house drove up the price of homes. We're nowhere near finishing tariffs. And that's what Powell wants to wait for. [05:16] That's why that's why he's on [05:17] hold. He's prudent. Score one for Powell. So what's the case against Powell's patience. If you believe the economy is about to fall apart then there's no time to wait. But we just heard [05:28] from the big banks over the last [05:29] two days. Not one of them said the consumer is hurt a lot of that's because it's still incredibly easy to find a job. Sure, there are lots of layoffs at the banks themselves, but there aren't a lot of white collar workers without jobs. I find it very hard to worry about a downturn when unemployment is at 4.1%. That's the problem with [05:45] President Trump's position. The Fed's supposed to cut in a slowdown, but we don't have a slowdown. And the only thing that might cause one is the president's tariff policy. It's paradoxical Mexican standoff. If Powell doesn't wait, if he cuts front running the August set of tariffs, he behaving. And if [05:58] he's wrong he'll look like a [05:59] fool. He has absolutely no reason to cut other than to stop the heckling. What's in it for President Trump if he tries to fire Powell? I think we saw it today. Nothing. The stock market [06:08] would get rocked. Long term interest rates would rise. What president would want that to happen? If I were President Trump, I'd wait to see what happens with his tariffs. As long as inflation is stable two and a half months from now, then by all means bash Powell for refusing to cut rates. But today [06:23] should have been a real wake up [06:24] call. For who? For the president. He doesn't self no favors if he fires Powell, even if he thought Powell was a doofus, which he most decidedly is not, you would still be fighting all the usual enemies. You charge the Fed's independence. I'm one of them. [06:36] It's been good for it's good [06:38] good policy for our great [06:40] nation. It's worked. Ain't broke. Don't fix. So, Mr. [06:43] President, write down this one. May 15th, 2026. That's when Jay's done it. Loyalty is clear to the country. It can't be that. Plus this whole rap about [06:51] how Powell may have spent too [06:52] much money on the Federal [06:53] Reserve renovation. Why is he like that guy? He's like, it's not his house. Trump's credibility is hurt by this. This Powell looked like a guy who cares about this stuff. Does [07:02] he does he look like a [07:04] contractor? Honestly, the guy is so intense about his job that if you told me he didn't even choose the color of paint in his own office, I believe you. Bottom line, I hope today is the last day that Trump goes after Jay Powell, whose term ends in ten months. Anyway. Got it for Powell only hurt Trump the same way it hurts the markets. And I [07:20] don't think the president's a [07:22] masochist. At the end of the day, we're either going to see more inflation or not. If inflation really does pick up, firing Powell won't matter because the rest of the Federal Market Committee won't let him cut either. Mr. President, sometimes this is genius by me. [07:34] It's better to leave well enough [07:36] alone. Hey, let's go to Tom in Illinois, please. Tom. >> Hey, Jim. >> Thanks for taking my call. [07:41] >> My pleasure. What's up? >> I wonder what you think about Sony. I know the government's coming after Japan with tariffs. How do you think that'll affect the stock? [07:50] >> I don't want to be there. I won't be there because I think Japan's going to get the brunt. Too many soldiers there. We've done too much for them. I think that Japan and Korea, the next wave is what I think that Jay Powell is worried about, too. [08:02] The next wave is going to be [08:05] really. It's just going to be. >> Stop, stop, stop. The house of pain. >> Let's go to Rick in Illinois, please. Rick. [08:13] >> Jimmy, how are you today? >> I'm having a pretty good day. How about you? >> It was okay, except for this Powell announcements during the day. It's a little bit upsetting, but we move on. Jim, [08:25] I've been an acolyte of years [08:26] since since Cramer and Kudlow. >> No that's not possible because it was Kudlow and Cramer I lost a coin flip I wanted Cramer and Kudlow I mean let's just tell the truth. After 25 years it's time to tell the truth I wanted Cramer in Kudlow. So did my dad. All right what else. What else. Yeah what. [08:43] >> Do you do I'm not a member of [08:46] the club. And my question to you is what's with micron. They reported earnings. They were outstanding. Made a new high at 137. And now it's like they're [08:56] going out of business. >> I got to tell you I look at it every day. You know I said what's with micron three times today. I think that run from from 70 to 130 really got people spooked I don't know. Now everyone's talking about how the charts bad. I'm with you. I [09:12] think the stock is inexpensive. But you know what the chart is saying. We got to wait. I'm going to obey the chart. I just am I'm going to obey the chart. [09:20] And anyway, I like Nvidia. Let's go to Anthony in Florida Anthony. >> Hey Jim I just want to tell you I'm a member since day one and I love the meetings. I do not miss them with you and Jeff. They're really great. [09:31] >> Jeff works so hard Jeff he [09:33] when he goes out to lunch, he [09:34] goes out for like 30s. It's incredible. The guy is so intense, I love it. I sit right next to him and he is so dedicated to the club and it's fantastic. He's dedicated to you. How can I help? [09:45] >> Oh, I appreciate it. I'm, you know, 60 years old and I still got some time to stay in the market. And I want to get some dividends. And the reason is my company that I have. What do you think about Verizon with a 7% dividend? [10:00] >> I think it's okay. It's really just a bond. I mean, there's a lot of competition now in the telco business. You know, I wrote this book, I wrote this book, How to make Money in any market. And I had to default to a lot of the real estate investment trusts and to a lot of the master limited partnerships in the oil market. [10:19] Those are the only place where I [10:21] see really great value in [10:22] dividends right now, because the [10:23] stock market has run so much. It's a quandary, but those are the way to be able to answer the quandary. All right. Look, I'm hoping President Trump cools it with the two late Paypal rhetoric. I find it it seems too insulting for me at this point. [10:35] I think he's only hurting [10:36] himself. And of course, the markets do. On Mad Money tonight with earnings season kicking off, as always with the financials, I'm digging through the top and bottom lines of all the reports and giving you my take on the big banks and lots of surprising stocks have been rallying lately, but I found one that I think takes the cake. I'll reveal what it is and whether you should take a take a cut of the cheese. And we have the big banks reporting strong numbers. But what about the [11:01] regionals? I'm getting the latest with the top brass first horizon. So stay with Cramer. >> Don't miss a second of Mad Money Follow JimCramer on X. Have a question tweet Cramer hashtag mad mentions. Send Jim [11:23] an email to madmoney.cnbc.com. Or give us a call at one 800 743 CNBC. Miss something. Hea