#fedfundsrate

Fed Hikes By 25bp – Doesn’t Matter

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As expected, the Federal Reserve raised the overnight rate by 25bp (.25%). I think this was both the right move and irrelevant. Others disagree. – The Fed cited high inflation, high spending, high employment, and solid economic growth. – The dot plot shows 2 Governors who expect to keep the current fed funds rate through … Read more

Warsh Tells the Truth and it Doesn’t Matter

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On Friday, Federal Reserve Chairman, Kevin Warsh, spoke at Jackson Hole. He reiterated a commitment to the 2% inflation target and noted that inflation isn’t under control. Most importantly, he acknowledged that the current policy isn’t restrictive. His predecessor, Jerome Powell, used to comment often that he thought Fed policy was restrictive. Most saw the … Read more

The Fed Holds with Healthy Dissents

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The Federal Reserve concluded its July meeting and elected to keep the fed funds rate unchanged. Wall Street had a meaningful probability on a small rate hike (around 33%). While I understood the logic, and would have voted to hike had I been in the room, I was on record saying I thought they’d hold. … Read more

5 Things to Know in Investing This Week – The Dovish CPI Issue

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Quick announcement: I’m off and working from new locations for another year. I’ll be in Antigua, Guatemala for the next few weeks. While I’m here, I’m open to a small number of in-person conversations. If you’re based locally, or know someone here you think it would be worthwhile for me to meet, feel free to … Read more

June CPI is 3.5%

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As a reminder, I’m using the new shorter format here. I think the previous 9-10 page commentary was helpful when I started writing it every month, but is no longer serving us well. The CPI report does matter, but it’s not driving markets like it did in ’22, ’23, and ’24. In addition, the economy … Read more

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