When Puma announced on Thursday that former Adidas sales chief Arthur Hoeld would become its new CEO, replacing Arne Freundt over “differing views on strategy execution,” it wasn’t just a routine leadership shake-up.

The move added another chapter to one of the most iconic rivalries in corporate history: Puma versus Adidas.

That rivalry, marked by talent swaps and strategic one-upmanship, had also seen a dramatic turn in 2022 when Puma hired Bjørn Gulden, who had been a senior vice president of apparel and accessories at Adidas in the 1990s, to lead the company as its CEO.

But beneath these boardroom moves lies a far older and more personal story—one that began with a bitter sibling split in a small German town and evolved to become one of the most legendary feuds in global sportswear.

Adidas and Puma, two of the world’s largest sportswear giants, owe their origins not just to ambition and innovation, but to a bitter rift between two German brothers — Adolf and Rudolf Dassler.

This is their story:

A feud born in the Dassler family

The story begins in the 1920s in Herzogenaurach, a town of just over 20,000 people nestled in Germany’s Franconia region.

The Dassler brothers ran a shoe company together — Gebrüder Dassler Schuhfabrik (Dassler Brothers Shoe Factory) — operating out of their mother’s laundry room.

Adolf, known as “Adi,” was the quiet craftsman, focused on design and detail. Rudolf, or “Rudi,” was the extrovert and the salesman, charismatic and bold.

The pair found early success, most famously when American sprinter Jesse Owens wore their shoes to win four gold medals at the 1936 Berlin Olympics.

But the business — and their relationship — began to unravel during World War II.

Misunderstandings, personal grudges, and political tension turned into open hostility

The exact trigger for the rift between the Dassler brothers remains disputed.

Local records merely refer to “internal family difficulties,” but the most widely circulated story is that Rudi—often described as the more charismatic of the two—had an affair with Adi’s wife, Käthe, a betrayal that permanently severed the brothers’ bond.

Other theories have also emerged over the years.

Some revolve around tensions over their political affiliations—both brothers joined the Nazi Party in 1933—and debates over who could claim credit for inventing the revolutionary screw-in football studs that helped West Germany clinch the 1954 World Cup on a rain-soaked pitch in Berne.

One particularly infamous episode dates back to 1943, during an Allied bombing raid over Herzogenaurach.

According to reports, Adi and Käthe rushed into an air raid shelter already occupied by Rudi and his family.

Upon seeing them, Rudi allegedly muttered, “The Schweinhunde (pig dogs) are back.”

Rudi later claimed he had been referring to the RAF bombers, but Adi was unconvinced—another slight that deepened their already fractured relationship.

By 1948, the brothers had gone their separate ways, and Herzogenaurach was never the same again.

Herzogenaurach: “the town of bent necks”

Rudolf set up his own company on one side of the Aurach River and called it Puma.

Adi remained on the other side and registered his company as Adidas, a portmanteau of his first and last names.

It is here that the headquarters of these two giants stand even today, barely a couple of miles apart.

What followed was not just a corporate rivalry, but a town-wide schism.

Herzogenaurach became known as “the town of bent necks,” because locals would first look down at your shoes before deciding whether to speak to you.

“The split between the Dassler brothers was to Herzogenaurach what the building of the Berlin Wall was for the German capital,” local journalist Rolf-Herbert Peters said in a Guardian report of 2009.

Marriages between employees of Adidas and Puma were discouraged.

Each factory had its own football club, barber, and pub — even churches and bakeries aligned with one side or the other.

“Even religion and politics were part of the heady mix. Puma was seen as Catholic and politically conservative, Adidas as Protestant and Social Democratic,” said Klaus-Peter Gäbelein of the local Heritage Association in the report.

Even in death, the divide persisted: the Dassler brothers are buried in the same cemetery, but at opposite ends.

From the Cold War on cleats to modern brand warfare

The Adidas-Puma rivalry has evolved from personal vengeance to boardroom competition.

For decades, both brands fought for supremacy in football sponsorships, athlete endorsements, and Olympic moments.

Adidas signed stars like Franz Beckenbauer and David Beckham, while Puma snapped up Pelé, Usain Bolt, and most recently, Neymar Jr.

The brands’ differing identities also became part of their competitive edge.

Adidas leaned into innovation, performance, and heritage. Puma took a more youthful, fashion-forward route, collaborating with artists like Rihanna and designers like Alexander McQueen.

Despite the intensity, modern leadership at both companies has attempted to thaw relations.

In 2009, employees from both firms played a symbolic football match to promote peace and reconciliation. But in the marketplace, the fight remains fierce.

Today, Adidas and Puma collectively generate billions in revenue, competing globally with the likes of Nike and Under Armour.

Yet in Herzogenaurach, the rift still echoes. Locals still joke that the easiest way to offend someone is to wear the wrong shoes.

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The United States stands at a crossroads as President Donald Trump’s sweeping tariff plan, unveiled this week, sends shockwaves through financial markets and reignites recession fears.

With the stock market reeling from significant losses and global leaders hinting at retaliation, the Federal Reserve faces a complex challenge.

Federal Reserve Chair Jerome Powell’s cautious stance—maintaining the benchmark interest rate at 4.25% to 4.5%—reflects a central bank wrestling with dual threats: a potential economic downturn and persistent inflation exacerbated by Trump’s trade policies.

As Trump pressures the Fed to cut rates to cushion the economy during what his administration calls a “detox period,” economists are divided on the wisdom of such a move.

The tariff trigger and market turmoil

Trump’s tariff announcement, labeled “Liberation Day” in a Truth Social post on April 2, 2025, introduced a plan described as much bigger than expected.

This policy shift has sparked widespread concern, with the stock market tanking this week, a development attributed to recession fears by James Glassman, a former economist with JPMorgan Chase.

Trump’s tariffs will likely cause consumers to reduce spending due to higher taxes on goods, a factor Powell acknowledged on Friday as having greater effects on inflation and growth.

Additionally, workers are increasingly worried about layoffs, influenced by the spectacle of sweeping federal workforce cuts led by Elon Musk’s team at the Department of Government Efficiency.

Businesses, too, are expressing uncertainty and pulling back from investments, amplifying economic unease.

The global response remains unclear, but the prospect of retaliatory measures looms large, adding to the pressure on the US economy.

Powell’s Friday remarks at a business journalists’ conference in Arlington, Va., underscored the tariffs’ unexpected scale, noting their potential to disrupt economic stability.

This situation has shifted the Fed’s focus, with Glassman arguing that recession fears have overtaken inflation as the central bank’s primary concern, a perspective that has intensified the current market volatility.

The Fed’s current stance: cautious restraint

The Fed’s benchmark interest rate, set at 4.25% to 4.5%, is considered “modestly restrictive” by Powell, a deliberate strategy to address inflation, which he described as stubbornly high.

This rate exceeds the historical norm of around 3%, a level Powell has identified as typical for economic growth.

The central bank’s approach reflects its ongoing effort to manage price pressures, a challenge that has persisted since inflation last met the 2% target in 2021, with new projections suggesting it may not return to that goal until 2027.

Powell’s comments on Friday suggest a deliberate pace.

We don’t have [a Federal Open Market Committee] meeting until May 6 and 7. We’re kind of thinking ahead to that and working through all of that. I will say, though, you know, it feels like we don’t need to be in a hurry.

This cautious tone reflects the long lags in monetary policy effects, which economists estimate can take months to impact the economy.

The next meeting, scheduled for mid-June, provides another opportunity for review, but Powell emphasized the need to ensure any tariff-driven inflation does not become persistent, indicating a wait-and-see approach.

Financial markets, however, are signaling a different urgency.

The markets have penciled in four rate cuts starting in June, with the odds of a May move rising as the stock market declined this week.

This market sentiment contrasts with Powell’s reluctance, highlighting a tension between investor expectations and the Fed’s measured strategy.

The tariff dilemma: inflation vs. recession

Trump’s tariffs present a significant dilemma for the Fed.

The policy is expected to boost inflation immediately, with many suggesting it could push prices above the current level, a concern Powell addressed on Friday.

This potential rise complicates the Fed’s efforts to maintain price stability, especially given the 2% target remains out of reach.

After consumers face higher prices, growth will slow, and inflation may subsequently decline, creating a cyclical challenge for monetary policy.

This scenario forces the Fed to choose between responding to higher inflation or protecting the economy from a possible recession.

Krishna Guha of Evercore ISI noted that Powell’s remarks underline the absence of conditions for a “Fed put”—the notion that the Fed will intervene to support a falling stock market.

Guha suggested Powell has positioned the Fed to cut rates if unemployment rises materially, but the current economic indicators remain unclear on this front.

Joe LaVorgna of SMBC Nikko Securities America argued that in normal times, the Fed might consider pre-emptive moves to prevent an economic downturn, but inflation’s persistence currently precludes such action.

The White House, through economic adviser Kevin Hassett, frames the situation differently.

In a recent Fox Business Network interview, Hassett suggested the economy is doing well, with long-term rates coming down and inflation having eased, predicting a shift to “cruise control” over the next few meetings.

This optimism contrasts with the tariff-induced pressures, leaving the Fed to navigate a complex interplay of growth and price concerns.

Trump’s pressure and historical context

Trump’s call for immediate rate cuts echoes his past criticisms of Powell, a dynamic that has long unsettled economists due to his disregard for the Fed’s independence.

Francesco Bianchi of Johns Hopkins University, who has studied Trump’s tweets from his first term, offered a historical perspective.

He suggested that in hindsight, Trump’s 2018 push to keep rates low might have been correct, as the Fed later reversed its rate hikes in 2019 after moving toward the 3% norm.

Bianchi noted that Trump’s motivation was to pressure trading partners like the euro zone, but he warned that current calls for easing could jeopardize the Fed’s credibility if inflation spirals, a risk even detrimental to Trump’s administration.

Trump’s recent Truth Social post on April 2, 2025, reinforces his stance:

The Fed would be MUCH better off CUTTING RATES as US Tariffs start to transition (ease!) their way into the economy.

This pressure highlights his impatience, a theme consistent with his earlier tenure, and places the Fed in a politically charged position as it considers its next steps.

Options for the Fed: cut, hold, or hike?

The Fed’s decision-making process is shaped by these competing pressures, with three potential paths emerging:

1. Rate cuts: Glassman argued in an email that the case for lowering rates is compelling given the potential headwinds, suggesting the Fed has room to reduce its benchmark rate. This aligns with market expectations of four cuts starting in June, potentially addressing recession fears. However, continuing concerns over inflation, as noted by Powell and LaVorgna, pose a significant barrier, risking a loss of control over prices.
2. Hold steady: Powell’s current approach favors maintaining the 4.25% to 4.5% range until at least May, allowing time to assess the tariffs’ full impact. This stance reflects the long lags in policy effects and the need to avoid hasty moves, as Powell suggested.
3. Rate hike: While less likely, a rate increase could be considered if inflation surges due to tariffs, a scenario Powell emphasized on Friday. This would prioritize price stability, but recession concerns suggest such a move could deepen economic challenges, conflicting with the Fed’s employment goals.

Economic indicators and global ripples

Unemployment concerns are rising, driven by layoffs linked to federal cuts and business uncertainty.

Consumer spending is likely to decline as tariffs raise prices, a dynamic Powell noted as a growth risk.

Globally, the threat of retaliatory tariffs adds complexity.

Powell’s Friday statement, “We face a highly uncertain outlook with elevated risks of both higher unemployment and higher inflation,” captures the Fed’s challenge in this volatile environment.

The Fed’s credibility at stake

The Fed’s independence is a critical issue, as Trump’s public demands risk politicizing monetary policy.

Bianchi’s warning about the dangers of losing control over inflation underscores the stakes, noting that credibility is essential for consumer trust and the central bank’s effectiveness.

Powell’s strategy of waiting for clearer data, as expressed on Friday, aims to preserve this autonomy, but the market’s push for cuts tests his resolve.

A delicate balancing act

As of April 6, 2025, the Fed faces a delicate balancing act.

Powell’s cautious stance suggests a hold through the May 6-7 meeting, with a potential reassessment in mid-June if recession signals strengthen.

Glassman’s case for rate cuts reflects market sentiment and the need to address growth concerns, but inflation’s persistence, as Powell and others note, argues against haste.

Trump’s tariff salvo has shifted the economic narrative toward growth preservation, yet the Fed’s 2% inflation target remains elusive.

The central bank must navigate this uncertainty with precision, resisting political pressure while safeguarding the economy.

The May meeting will be a critical juncture, with the long lags of monetary policy ensuring that the Fed’s next move will have a lasting impact.

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