Everyone yearns to be recognized and understood.

It’s an innate need — an inescapable part of the human condition. Unfortunately, it’s often unmet.

When it comes to the financial world, few are as misunderstood and disrespected as Federal Reserve Chair Jerome Powell.

It honestly irks me to no end.

Powell has said before that, “There is no risk-free path for monetary policy.” He’s right, and it also means there’s no criticism-free path either.

This makes me think of the immense difficulty the Fed faces and how poorly informed pundits use Powell as a punching bag.

So today, I’ll break down what the Fed actually does for the economy, its success over the past five years, and Jerome Powell’s unjustified poor approval rating.

Let me explain...

Popular Opinions Miss the Mark

I have always been bothered by the strong consensus opinion that the Federal Reserve doesn’t know what it is doing and is constantly wrong.

The first aspect of this opinion that bothers me is how and why the people who express it think they know better.

The most knowledgeable critics have the same background as the Fed governors. They went to the same schools, share many life experiences, and have many commonalities.

Why would they have better insight than these people (the governors), who have more data and do this full-time with vast teams working with them?

For the rest of us, why on earth would we think we know any better?

We don’t have the training, the information, the team, or the experience.

It reminds me of a football fan watching an NFL game and yelling at the coach for a particular call.

I’m sure the fans are knowledgeable. But to think they know better than a highly trained and experienced professional with access to extensive information and who has studied the situation is ludicrous.

That is what any one of us criticizing the Fed governors is like.

The Fed knows what it is doing and is best positioned to make decisions to steward our economy's growth and stability.

That does not mean they get every call right, just like a professional football game. It also doesn’t mean they will win every game.

The goal is to get most of the calls right and post a winning season that eventually ends up winning the championship.

This is also a lot like trading and investing.

Powell Can’t Win ‘Em All

You would never expect a money manager to get every single call right.

What you want them to do is the work, have a sound process, and then make the best decisions possible that ultimately result in your portfolio making money.

During that process, you will still have losing positions. You may also have months or quarters where you lose money.

You could even have long streaks of not getting much right because some assumptions you have made are incorrect.

The best traders or money managers learn from their mistakes, adjust their process, and evolve with the ever-changing market environment.

This is exactly what the Fed does!

It’s true. The Federal Reserve underestimated the magnitude and duration of inflation, so it raised rates. Perhaps they had to do much more than initially anticipated.

Eventually, though, the economy reached a point where inflation was under control and growth remained steady.

You and I Make the Difference

The Fed has taken us to the playoffs for the last five years.

We survived one of human history's most traumatic socio-economic events: COVID. And we did it without the economy collapsing and with overall social stability.

The economy also returned to steady and stable growth with rising incomes. I count that as a “win.”

The Fed has done a tremendous job over the three decades of my career.

Looking back from the early 1990s to today, I have seen huge progress in our economy, society, and stock market.

The incredible progress isn’t because of the Fed, but because of American capitalism and the growth and stability inherent in our economic and social system.

The citizens and companies are the players. They are ultimately responsible for the winning.

The Fed is the coach. And despite unpopular opinion, it has done a pretty darn good job of getting us to the championship year after year.

Jerome Powell and his team aren’t perfect — no one is.

But their work has helped steer the U.S. economy through one of the most volatile periods in modern history.

In a time when quick takes and blame games dominate, it’s worth stepping back and recognizing that competence and long-term thinking still matter.

And in my view, Powell’s doing a lot more right than wrong.