Federal Reserve Chair Jerome Powell has signaled a willingness to tolerate higher inflation in the short term to support the labor market. Following Powell's speech at Jackson Hole, the DIA ETF surged to new all-time highs. Investors responded positively to Powell's dovish stance, with the Fed prioritizing job creation over inflation concerns, potentially leading to a rate cut in September. This unexpected shift in policy stance propelled stocks, with the S&P 500, as represented by the Vanguard S&P 500 ETF (NYSE: VOO), climbing 1.55% to reach record levels. The market's reaction triggered a rally across risk assets, indicating optimism among investors.