1. Other than Moran, disagreement about the nature of rate cuts in an era where it appears the dual mandate is a strict trade off is important.
2. There have been some good quotes from former Fed officials in other articles about this (notably the WSJ) where they caution about rate cuts coming too quickly. Most about how you don’t want to cut rates too quickly and hit the economic wall.
3. Monetary policy, unlike fiscal policy, is hard to target certain groups or areas. And changes can take effect quickly. That means that caution is warranted.
4. Officials also pointed out that the recent shutdown (the last one of any length was still only a partial shutdown) impacts the early release data. We should get a lot more clarity as the Oct/Nov data get refined, and from the Dec/Jan data.
hpbear108 on
from what I read of this summary of the Fed minutes, I have to wonder something. How much is their decision being hampered by the potentially questionable numbers from the BLS and other government agencies, how much is the fear between balancing inflation vs employment, how much is this the tariffs, how close the potential bubbles in AI and housing are to potential busting, and how much this may be a result of the K-shaped economy we’re currently expanding, where all these issues cause much more problems at the bottom where most of the spending occurs compared to where the top is hoarding more and more?
2 Comments
1. Other than Moran, disagreement about the nature of rate cuts in an era where it appears the dual mandate is a strict trade off is important.
2. There have been some good quotes from former Fed officials in other articles about this (notably the WSJ) where they caution about rate cuts coming too quickly. Most about how you don’t want to cut rates too quickly and hit the economic wall.
3. Monetary policy, unlike fiscal policy, is hard to target certain groups or areas. And changes can take effect quickly. That means that caution is warranted.
4. Officials also pointed out that the recent shutdown (the last one of any length was still only a partial shutdown) impacts the early release data. We should get a lot more clarity as the Oct/Nov data get refined, and from the Dec/Jan data.
from what I read of this summary of the Fed minutes, I have to wonder something. How much is their decision being hampered by the potentially questionable numbers from the BLS and other government agencies, how much is the fear between balancing inflation vs employment, how much is this the tariffs, how close the potential bubbles in AI and housing are to potential busting, and how much this may be a result of the K-shaped economy we’re currently expanding, where all these issues cause much more problems at the bottom where most of the spending occurs compared to where the top is hoarding more and more?