Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTSean Williams, The Motley FoolSat, July 18, 2026 at 12:56 PM GMT+2 6 min readWith more than half of 2026 in the books, it's shaping up to be another stellar year for the stock market. Since early June, the ageless Dow Jones Industrial Average (DJINDICES: ^DJI), broad-based S&P 500 (SNPINDEX: ^GSPC), and growth-stock-fueled Nasdaq Composite (NASDAQINDEX: ^IXIC) have all powered to record highs.However, Wall Street's major stock indexes don't always paint a complete picture of what's going on behind the scenes. While several catalysts lie in wait to upend a historically expensive stock market, few if any are drawing as much attention as inflation.Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »Fed Chair Kevin Warsh delivering remarks from the White House. Image source: Official White House Photo by Daniel Torok.Fed Chair Kevin Warsh, who officially succeeded Jerome Powell on May 22 as head of the central bank, is being challenged out of the starting gate. In May, trailing 12-month (TTM) U.S. inflation reached a three-year high of 4.2%, prompting questions of whether Warsh and the Federal Open Market Committee (FOMC) -- the 12-person body responsible for setting the nation's monetary policy -- will raise interest rates.Though no one ever said that overseeing monetary policy for the world's largest economy would be easy, Warsh has ascended into a veritable no-win scenario, courtesy of President Donald Trump.As recently as five months ago, inflation wasn't a top concern on Wall Street. Although Trump's tariffs were modestly pushing up prices in the goods sector (something former Fed Chair Powell alluded to in several FOMC meetings), TTM inflation in February was just 2.4% and moving toward the FOMC's long-term inflation target of 2%.By May, everything had changed.Trump's decision to attack Iran on Feb. 28 resulted in the latter shutting down the Strait of Hormuz to most maritime traffic. This essentially halted the flow of a fifth of the world's petroleum liquids, sending energy prices soaring. Over three months, TTM inflation had jumped to 4.2% -- more than double the Fed's long-term target.Despite the president's policies having a clear inflationary impact, Trump has been publicly calling for the FOMC to slash interest rates for more than a year. Although Powell and the FOMC lowered the federal funds target rate six times from September 2024 to December 2025 to its current range of 3.50% to 3.75%, Trump has opined that interest rates should be cut to 1% or lower.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info