GOODBYE POWELL: Final Fed FOMC Presser & Rate Decision!

[00:01] All right. All right. All right. Here we

[00:03] go. Here we go. It is another

[00:08] Federal Reserve rate decision and press

[00:11] conference. The difference this time is

[00:14] it is Jerome Powell's last. Now, this is

[00:17] uh quite bittersweet. Jerome Powell has

[00:20] been covered on this channel for about 8

[00:22] years. Uh we've been covering him uh

[00:24] certainly since at least 2018, maybe

[00:26] even longer than that, which is crazy

[00:28] because welcome to 2026.

[00:31] Means it's been 8 years of talking about

[00:35] J Pow on this channel. And honestly,

[00:38] it's I don't know. It's kind of sad. You

[00:42] know, Papa Pow is going away. You know,

[00:44] don't fight the Fed. You know, all the

[00:46] fun stuff over the past years. uh you

[00:51] know, inflation, transitory, you know,

[00:53] all the entertainment. It's incredible.

[00:55] But it uh it really ends uh today. Now,

[00:58] Powell's term doesn't end today.

[01:00] Powell's uh term as governor ends on the

[01:02] 15th of next month. That's May. And uh

[01:06] at the uh beginning of 2028, January

[01:09] 31st, 2028, Jerome Powell uh will be

[01:12] required to leave as a um Fed board

[01:16] member, you know, one of the board of

[01:17] governors there. Uh Dr. Pal may leave

[01:20] now as is typically tradition uh after

[01:23] May 15th. Of course, I think he'll

[01:25] probably just end up getting sued again

[01:26] by Trump. And if he waits until January

[01:29] 31st, 2028, maybe uh Trump will have

[01:32] forgotten about him. So, we'll see. It's

[01:34] it's uh it's going to be really

[01:36] interesting. And uh it's it's the last

[01:38] time. So, you know, I'm actually going

[01:40] to put on our bingo board. Uh this is I

[01:44] think he's going to get a standing

[01:45] ovation today. So, we think he's going

[01:48] to be on time. We we expect that.

[01:50] Hopefully, Wars can keep that up. We'll

[01:52] we'll see. Uh but uh but I'm actually

[01:54] going to mark standing ovation here. Uh

[01:57] so, we'll say um let's get the pencil

[02:00] here. There we go. Standing

[02:04] uh ovation.

[02:06] Ovation

[02:08] for uh Powell.

[02:10] Uh like at the end probably, right?

[02:13] Standing ovation for Powell. He's on

[02:15] time. Obviously, uh this is going to be

[02:17] a hard column to get. So, we'll throw an

[02:19] easy one in here. We'll throw in the

[02:21] purple tie. Uh you know, I I do think

[02:24] we'll probably hear some form of a

[02:26] reference of uh you know, high for

[02:29] longer. Uh high for longer

[02:33] uh or or some sort of a hold for longer.

[02:38] I think that overall he is going to

[02:41] cheer the ADP and the job numbers.

[02:45] sheer job numbers

[02:48] uh job numbers

[02:50] I think he'll uh say that the economy is

[02:53] doing better than expected

[02:56] economy

[02:58] uh better than expected

[03:01] and that's going to justify uh you know

[03:03] rate stabilizing right uh better than

[03:06] expected

[03:08] you know obviously we have uh an oil

[03:11] shock which is a apply uh driven shock

[03:17] uh oil uh/supply shock.

[03:25] So, uh you know, that'll kind of get our

[03:28] bingo board started here. We'll have a

[03:30] little bit uh extra work to do. Yeah,

[03:32] you know, we we could throw in a good

[03:33] afternoon. And honestly, it might be the

[03:35] last good afternoon we get, you know.

[03:37] Good afternoon. Yeah, good afternoon.

[03:41] Good afternoon.

[03:45] Uh, I do think he'll likely say he has

[03:48] not made the decision yet on whether

[03:50] he'll stay. Uh, will you stay?

[03:56] Um, no decision yet.

[04:01] Uh, yet. This is not the place.

[04:06] Uh, the place.

[04:09] Okay.

[04:11] Uh so he'll share the job numbers. I

[04:15] think we'll see some of the if you've

[04:16] been we talked about this in the uh the

[04:19] alpha report this morning. Uh the

[04:21] capital good orders non-defense xair

[04:24] phenomenal. I mean like blew

[04:27] expectations out of the water. Uh

[04:30] obviously a lot of this is artificial

[04:32] intelligence related spending but uh you

[04:35] know that's already been factored in to

[04:36] expectations. So, you know, there there

[04:39] are still components of this economy

[04:41] that are booming. And you know, this

[04:42] week has obviously been a little

[04:44] volatile. We went in Monday morning

[04:47] before the market opened up. We said in

[04:49] the course member live streams, this is

[04:51] not the week for calls. And you know,

[04:54] the market's been I actually even said,

[04:55] I'm leaning bearish this week. And I

[04:58] mean, some of the numbers, you know, a

[05:00] little little rough right now. We

[05:02] actually have a um a we created this

[05:04] probably eight months ago. uh back when

[05:08] Robin Hood was like 14%. We did a

[05:11] fundamental analysis on Robin Hood and

[05:13] we're like I'm not touching this this

[05:16] stock until it is $69

[05:19] or below.

[05:22] We're at 70. Uh so we're almost there.

[05:25] It's it's actually really incredible uh

[05:27] that that you know it it came down this

[05:30] far because that's where I thought was a

[05:32] more fair price for the stock. So it's

[05:35] really incredible. Uh but uh you know,

[05:37] same thing with even something like an

[05:39] NPC. You know, they've been going into

[05:40] this power purchase agreement, low

[05:42] margin business. I'm like, this is

[05:44] ridiculous. You can't go anywhere near

[05:46] this thing, as has been the case for a

[05:48] while. Um but um let's keep going with

[05:51] the uh the Powell sheet here. Uh in

[05:54] honor obviously of Powell's last day,

[05:56] we're doing a very brief code for him.

[05:58] Goodbye Powell at meetke.com. So if you

[06:01] want to join us in that membership, meet

[06:02] Kevin.com. But let's focus on this. So

[06:04] we got goodbye. Good afternoon. You

[06:05] know, I actually have an old one here

[06:07] which is kind of cool. Look at this. I

[06:08] could kind of cheat. Fit flexible

[06:11] inflation targeting. You know, they

[06:12] stopped referencing that. They

[06:14] referenced that for a while. Low,

[06:15] higher, low fire. You know, we might

[06:16] hear that banking sounded resilient,

[06:18] right? This is an old one. This is from

[06:20] October. Evolving outlook. There's no

[06:22] evolving outlook anymore. You know, some

[06:24] of these are kind of old.

[06:28] Uh 50 BP cuts not necessary at this

[06:30] time. We didn't get any 50 BP cuts

[06:32] anyway. So, that was somewhat in

[06:34] alignment. Uh I I do think low higher

[06:36] low fire is sort of an easy win here we

[06:38] could write down. So let's do it. Low uh

[06:41] higher low fire. But uh but

[06:47] uh bonus or or uh but

[06:51] uh labor market

[06:55] uh showing signs

[07:00] of uh rebounding

[07:05] after stabilizing, right? So um

[07:09] rebounding is is even better than

[07:11] stabilizing. You want that. That is that

[07:14] is bullish, right?

[07:19] So, uh we got labor market, we got the

[07:22] oil supply shock obviously is going to

[07:24] get a mention on time. Good afternoon.

[07:26] Um you know, I I do think we'll see the

[07:28] two-sided risk. Twosided

[07:32] risk. You know, I I do think he hawks

[07:37] he hawks more than expected.

[07:43] And overall, it's actually bullish for

[07:45] the economy.

[07:47] Bullish

[07:49] uh economy.

[07:52] And I think he'll also cheer

[07:55] uh handing

[07:58] uh a strong economy

[08:01] economy

[08:03] to uh Worsh, you know. So, I think he'll

[08:07] he'll sort of like declare victory on

[08:09] that a little bit, right? Uh question on

[08:12] the lawsuit. Yeah, he'll get asked

[08:15] and he'll he'll ignore

[08:17] Pentagon to send one of its aircraft

[08:19] carriers home from the Middle East. Oh,

[08:21] wow. Uh okay. So, let's mark how are we

[08:26] going to put that? Uh I'll put um punts

[08:32] question

[08:34] on

[08:36] uh lawsuit.

[08:41] That's pretty much expected. I also

[08:43] think he's going to talk up consensus

[08:45] about the rate cut, right? Uh so uh talk

[08:50] up

[08:52] consensus

[08:54] on uh rate

[08:57] rates

[08:59] I'll call it rates staying stable rates

[09:02] uh staying

[09:05] Uh there we go. Stable.

[09:09] Okay.

[09:11] So, because he wants to set up consensus

[09:13] before WSH gets in is my anticipation.

[09:17] Uh yeah, transit. I don't know that

[09:19] he'll use the transitory over time. Uh

[09:22] but um the I certainly think he'll refer

[09:25] to longer inflation shocks,

[09:28] longerl

[09:30] lasting

[09:32] inflation shocks.

[09:36] Shocks. Uh I think it's pretty obvious

[09:39] that he's going to say the job isn't

[09:41] done. something like um

[09:44] job isn't

[09:47] done yet

[09:51] on inflation.

[09:54] There we go.

[09:58] Uh let's see here. H

[10:02] his last words. F everyone.

[10:05] Does he call it a soft landing? Yeah. I

[10:09] mean, um I think we're kind of beyond

[10:11] the land part and it's more of the

[10:12] takeoff part, right? Um

[10:17] he might he might, you know, I'll write

[10:19] it down. Uh so some reference to having

[10:21] achieved

[10:25] reference

[10:27] to

[10:28] achieving

[10:31] soft landing.

[10:34] Yeah, it's very interesting, you know,

[10:35] just because the economy has really been

[10:37] through the ringer. You know, it's like

[10:39] there have been a lot of shocks and

[10:41] stresses for the economy. Uh and uh you

[10:44] it's a lot for the economy to go

[10:45] through.

[10:48] I think certainly uh one of the reasons

[10:50] we we went through it as well as we did

[10:52] is you know the amount of money that

[10:54] people had been able to build up postco

[10:57] obviously artificial intelligence helps

[10:59] as well but the economy went through the

[11:01] reamer you know the ringer the reamer

[11:03] had like a colonoscopy you know it's

[11:05] like it's almost like getting a PCAOB

[11:08] audit you you all might know like very

[11:11] few companies actually get PCAOB level

[11:14] audits they're they're very expensive

[11:16] they're very rigorous uh house hacks

[11:19] going through or reinvest is going

[11:21] through its PCAOB audit right now

[11:24] dude it finishes tomorrow it is a lot I

[11:28] mean it's really good you know it's like

[11:31] uh it's like somebody just checks and

[11:33] questions everything and it's great

[11:35] because you know the better the more you

[11:37] do them the better you are at just like

[11:39] having things prepped for them because

[11:40] you kind of anticipate what they're

[11:41] going to ask uh and our books are like

[11:44] really good so it's nice to affir

[11:46] confirm that what we're doing is great

[11:47] at house hack and reinvest but it's a

[11:50] lot of work. Uh and so I I understand

[11:52] why a lot of companies don't go through

[11:53] it but I mean that was all reference to

[11:56] this building on like the economyy's

[11:57] really been has gone through this sort

[11:59] of like colonoscopy and it's you know

[12:02] it's done really well. It's it's come

[12:03] out you know it's gotten it's gotten a

[12:06] lot of biopsies but doesn't seem to have

[12:09] any big problems right now which is

[12:10] great. Somebody writes Jerome Powell

[12:12] statue on the lawn. You know, we did say

[12:14] that. We did say we need a Jerome Powell

[12:16] statue if uh if he sticks the soft

[12:19] landing. And uh uh Yeah. Yeah. Yeah.

[12:23] You're right. We're going to have to

[12:24] Does anybody know somebody who can make

[12:27] a statue?

[12:29] If you can make a stone statue, please

[12:33] email staffmeke.com.

[12:36] Uh you know, I need like a three foot

[12:38] tall mini. That's not really mini. is

[12:40] pretty big, but 3 ft. That'd be about

[12:42] right.

[12:44] We got We got to follow the problem. I

[12:46] just need somebody to make it. I'll put

[12:47] it right next to my giant gong. That's

[12:50] with a G in case in case that didn't

[12:52] come through clearly. You know, one of

[12:54] the bong.

[12:57] Anyway, uh all right. So, I you know, my

[13:00] big call today is I I think he deserves

[13:02] a standing ovation. We'll see. But, uh

[13:05] you know, reference to achieving soft

[13:06] landing. I'll I'll I'll see that.

[13:08] Somebody says I can make a bronze one.

[13:10] Bro, I'd take a bronze one. Email us

[13:13] because I'll, you know, I'm gonna hose

[13:15] that thing so much it's going to turn

[13:16] green like the Statue of Liberty. I need

[13:18] him holding a book. No, I don't I don't

[13:21] know. What should he hold? Should he

[13:22] hold anything? No, he doesn't need to be

[13:23] holding anything. He's just got to be

[13:25] like a smug face with his arms crossed.

[13:26] That's all you really need.

[13:29] Victory. But anyway, uh

[13:32] um

[13:34] or or him with the construction hat on.

[13:37] Oh, that'd be hilarious because uh you

[13:39] know it's sort of like standing up to

[13:40] Trump.

[13:42] All right, we got to finish this board.

[13:44] Uh

[13:46] come on, baby.

[13:49] Uh reference shaving off landing. Good

[13:52] afternoon. Higher for longer. Uh I'm

[13:55] going to say uh no no discussion of

[13:57] cuts. No talk of cuts. Uh, I think I

[14:05] wouldn't be surprised if even Myin goes

[14:07] for a hold. Even Myin uh might

[14:14] uh go for hold.

[14:18] Who knows? But it's possible. Uh let's

[14:21] say he does. Uh

[14:25] let's say he holds.

[14:29] Okay. Then uh no talk cuts. Good

[14:32] afternoon. Uh it's, you know, wait and

[14:34] see. Meeting by meeting. So we'll go

[14:37] meeting by meeting

[14:40] uh by meeting data dependent. And then I

[14:43] got one more meeting by meeting uh data

[14:49] dependent.

[14:51] And

[14:52] how about uh how about something like um

[14:57] uh let's see let's see let's see let's

[14:59] see let's see here.

[15:02] Somebody's like, "The Fed building is

[15:03] taxpayer dollars." The ballroom is like,

[15:05] "Bro, come on. Everybody knows that the

[15:07] ballroom is just like tariff extortion,

[15:11] you know. Hey, I'll give you a better

[15:12] deal on the on your tariffs and I'll

[15:14] give you some exemptions. Nvidia,

[15:16] Jensen, I'll let you sell some of your

[15:17] chips to China. I'll let you sell to

[15:19] China, but you know, I'm going to need a

[15:21] couple hundred mil for my ballroom." You

[15:24] know, it's all [ __ ] Oh, it's not

[15:26] taxpayer money. Come on, man. You know

[15:28] how much rigging is going up in there?

[15:30] And I mean, they all do it, but let's

[15:31] just say the level of rigage has been a

[15:33] little elevated lately. Okay, I think we

[15:35] can all agree on that one.

[15:40] Meeting by meeting. Come on, baby. I

[15:41] need one more. We got about a minute to

[15:43] figure this out. Uh, hold meeting. you

[15:47] know,

[15:49] the honor the he'll say something like

[15:52] honor the like he hopes that the future

[15:55] Fed chair honor will continue to honor

[15:57] the independence of the Fed. There

[16:00] independence

[16:02] of

[16:04] Fed. There we go. All right, cool. So,

[16:07] we got our bingo board ready. Let's uh

[16:09] you know, feel free to uh to take a

[16:11] little snappy doodle snapshot over here.

[16:15] Coupon code is goodbye Powell at

[16:18] meetcaven.com and househack.com.

[16:21] Keep in mind house hacks valuation AI is

[16:24] still on schedule for a June release.

[16:26] That's at the end of the Q2 time frame

[16:28] that we forecast. Uh that's still

[16:30] looking uh like it's on schedule. Got a

[16:32] lot of cool things coming out to the

[16:33] Meet Kevin Heaven app here as well soon,

[16:36] which we're very excited about. We've

[16:37] been doing a lot of updates lately and

[16:39] uh yeah, let's get hooked too. We're

[16:42] about to get He's JPAL's about to hawk

[16:45] to us.

[16:46] Yeah, it's staffmekke.com.

[16:49] If you want to make either a bronze or

[16:50] stone bust,

[16:52] email staff meetke Kevin.com.

[16:56] All right, here we go. Uh, okay. I got

[16:58] some headlines already while we wait for

[17:00] them to show up. So, we have uh policy

[17:03] statement draws most number of

[17:04] dissenting votes. What? 8 to four. Myron

[17:09] descented for a quarter point cut

[17:14] and then there was talk about Oh. Oh,

[17:16] right. Cuz we're not getting Powell now.

[17:17] We're just getting the statement now.

[17:18] Duh. Powell's in 30 minutes. Uh, so vote

[17:21] in favor of 8 to 4. That's a crazy

[17:24] split. Fed is considering the extent and

[17:26] timing of additional adjustments uh to

[17:29] Fed rates. The committee will carefully

[17:31] assess incoming data. Okay. The market's

[17:35] not really moving so far off the

[17:37] statement uh like at all. These are the

[17:40] cues right here. Job gains have remained

[17:43] low on average. Unemployment little

[17:45] changed. Indicators suggest economic

[17:47] activity has been expanding at a solid

[17:49] pace. Interest rates are unchanged with

[17:53] no signal for when rates may change with

[17:56] a high level of uncertainty due to the

[17:58] Middle East.

[18:00] Job gains have remained low on average.

[18:02] The unemployment rate little change

[18:04] characterizes inflation as elevated

[18:05] versus somewhat elevated in the previous

[18:07] statement. So we've moved to elevated

[18:10] versus somewhat elevated character.

[18:13] We've got the committee is attentive to

[18:14] both sides of the dual mandate. That's

[18:16] that dualsided risk. Developments in the

[18:19] Middle East are contributing to high

[18:20] level of uncertainty. Characterizes

[18:22] inflation. We saw that attentive to risk

[18:24] of dual side. Yes. Uh we've got okay

[18:28] vote in favor of policy was 84 with

[18:31] Myron dissenting in favor of a quarter

[18:33] point cut. Okay so that he's still going

[18:36] for the cut but a hammock Qashqari and

[18:39] Logan dissented against the inclusion of

[18:43] the easing bias in the statement. Okay,

[18:46] so that's really interesting. So

[18:47] basically

[18:49] there are members of the Fed who voted

[18:52] against Powell here to argue that we

[18:55] should actually get rid of any

[18:58] indication that we are even open to

[19:01] cutting rates in the future. Uh so let's

[19:06] write that down. That's uh that's

[19:07] somewhat interesting and then we can

[19:08] kind of uh understand this a little bit

[19:10] better uh together. So, the Fed's

[19:12] statement,

[19:15] and we'll jot this down together. So,

[19:17] we've got Hammock,

[19:19] uh, Cashari, and Logan, uh, voted no.

[19:24] Cash Kari voted no because they wanted

[19:29] to remove easing bias language from

[19:32] statement. Basically,

[19:35] they're trying to send a little warning

[19:37] sign. uh basically uh warning that we

[19:41] may not uh cut rates anytime soon. The

[19:46] committee

[19:48] uh is happy where they are. Uh and

[19:54] uh let's see here. What else would you

[19:55] get? It it also somewhat sets up for a

[19:59] harder time for Worsh, right? Sets up a

[20:01] harder time for war. war um biases uh

[20:08] towards rate cuts. If already committee

[20:12] members are freaking,

[20:16] uh wanting to remove any hints of cuts,

[20:19] uh they're preserving their optionality

[20:23] to go up in rates due to of course uh as

[20:29] they say, Middle East uncertainty.

[20:33] Okay.

[20:34] They do in the statement mention that uh

[20:37] job gains have remained low. So this is

[20:41] a lack of reference lack of uh mention

[20:44] in statement uh on the ADP reports. You

[20:49] know obviously rates unchanged that was

[20:52] expected.

[20:53] Uh, myin wanted a 25

[20:57] want a 25 BP cut

[21:00] and uh let's see committee carefully

[21:03] assess incoming data and the balance of

[21:06] risks. A lot of talk for rate cuts

[21:10] uh future rate cuts based on a balance

[21:15] of risk

[21:17] risks. Yeah, we've already known that uh

[21:20] most number of dissenting votes. This is

[21:22] four descents. So 8 to4 vote.

[21:27] Most descents since October 1992.

[21:32] That's when Kevin was born.

[21:35] Uh well Jan 92 but close enough. I think

[21:39] that's when hurricane What was the

[21:41] hurricane? I think that was hurricane

[21:42] Andrew. Oh that may have been September.

[21:45] Hurricane Andrew. Hurricane Andrew. Oh,

[21:49] was it the year before? No. August 92.

[21:52] August. That makes sense. More in

[21:54] hurricane season. Okay. Interesting. So

[21:58] then we've got

[22:02] inflation elevated. Oh. Oh. From

[22:04] somewhat elevated, right? And then they

[22:06] moved

[22:08] uh moved

[22:11] uh job gains have remained low.

[22:13] Unemployment rates stable.

[22:16] moved inflation from somewhat elevated

[22:20] to elevated. Now that's actually

[22:22] important.

[22:24] So

[22:26] this is uh this is a the these

[22:28] statements together here

[22:31] uh important because Fed will act on

[22:35] whichever

[22:38] mandate is closer from their goal. Okay,

[22:42] they're telling you

[22:44] employment is stable

[22:48] and inflation is now further from the

[22:51] goal, worse than before. This implies or

[22:56] sets up, you know, rate hikes.

[23:01] Um,

[23:03] and then, uh, I should put a note just

[23:05] at the quick top over here. Uh, goodbye

[23:09] Powell is the coupon code at meet

[23:13] kevin.com

[23:15] and uh, househack.com

[23:18] expiring tomorrow just in honor of

[23:21] Powell.

[23:24] Oh, I can't wait till we get to release

[23:26] some of these new things that are coming

[23:27] out for some uh, for the course members.

[23:30] We we already have such cool things. Uh,

[23:32] but then we'll be raising the price

[23:33] again quite a bit because when this

[23:35] stuff comes out, it's going to be

[23:36] incredible. Okay. So,

[23:40] yeah, let's send that through. Let's go

[23:42] uh let's listen into CNBC for a moment.

[23:44] See if they have anything fun for us.

[23:45] Opposite direction.

[23:46] I I know. Okay. Let's go back. This is

[23:48] We didn't get a rate cut. Nobody

[23:49] expected a rate cut. Okay, Francis, but

[23:51] I I think I'm one of them. And if I

[23:53] frame this incorrectly, please correct

[23:55] me.

[23:55] I'll let you know. I I'm sure you will,

[23:57] even your nice Canadian way, which is we

[24:00] have three members of the Fed board who

[24:02] dissented not on rates, right,

[24:04] but dissented because they indicated

[24:06] they don't want to cut later. It felt

[24:09] like a direct shot across the bow of an

[24:12] incoming Kevin Worsh administration.

[24:14] That's that's exactly what I was saying.

[24:16] It's basically this setup where you're

[24:19] like, "Hey, we're going to start uh

[24:22] planting the seeds for being anti-war

[24:26] internally." Internally, it's coming

[24:27] through. This is a committee that is

[24:29] marking to market the view, the language

[24:32] with where the data is. The data is

[24:34] telling you the labor market is

[24:35] extraordinarily tight. The data is

[24:37] telling you inflation is running near 3%

[24:39] and heading in the wrong direction. soft

[24:48] and the way you argue inflation, right?

[24:51] The just understanding this, the way you

[24:54] argue this is you call it transitory.

[24:56] That's all you could do. The only way

[24:59] you can mirn a rate cut or wash is if

[25:03] you argue the oil shock is short-term

[25:07] uh transitory. The problem is

[25:12] the more you call problems

[25:15] uh transitory, the more you risk

[25:18] deankering expectations. And then

[25:21] welcome to the 1970s, right? So here's

[25:25] the red line.

[25:27] Uh job gains have remained low on

[25:29] average, right? Because we've we've seen

[25:31] some highs and lows on some of the

[25:32] numbers. Inflation is elevated, right?

[25:37] They got rid of the remains somewhat

[25:42] high level of uncertainty

[25:45] whereas before they just had uncertain

[25:49] and that's it.

[25:51] Yeah, there it is. Maintaining the

[25:53] target funds rate, federal funds rate

[25:55] but did not the support the inclusion of

[25:57] an easing bias in the statement.

[26:02] Uh that would be this right here. In

[26:05] considering the extent and timing of

[26:07] additional adjustments,

[26:10] uh, we'll carefully assess the incoming

[26:12] data. Uh,

[26:17] I mean, I guess that's that's why they

[26:20] call it a bias because the implication

[26:21] there is like, hey, when are you guys

[26:23] going to do future rate cuts? Oh, well,

[26:24] it depends on the data. Okay,

[26:28] I think this vote might have been even

[26:31] more in favor of dissense or even that

[26:34] they would have taken out the easing

[26:36] bias if this was not Powell's last

[26:39] meeting. I think Powell wanted a hand to

[26:42] to war the status quo and didn't want to

[26:45] make a big change of where the Fed had

[26:47] been over the past several months just

[26:49] before he left. But I think that there's

[26:51] maybe more than three people and I've

[26:53] been following this torsion and I know

[26:55] you do probably better than I do. Each

[26:57] each word that's come out and a lot of

[26:58] those words have been about we're not

[27:00] comfortable with this idea. We want to

[27:02] go to more.

[27:03] Somebody says uh they're shorting AMD.

[27:05] You know, AMD has been one of the stocks

[27:08] that we've been shouting out in the uh

[27:10] the course membership because we've been

[27:12] talking since since the beginning of

[27:13] April about how uh AMD is actually very

[27:16] undervalued and how there's a uh a CPU

[27:19] boom happening that people aren't paying

[27:21] attention to. Uh and so we've been

[27:23] talking about this for quite a while.

[27:24] And so it doesn't it doesn't surprise me

[27:26] that it's rocketed like this. But if you

[27:29] are shorting AMD, you do want to watch

[27:30] this 34226

[27:32] line. I personally don't have the balls

[27:36] to do that. I I I I'm not going to make

[27:38] bets against hardware right now. Uh I I

[27:41] do think the better bet in the long

[27:43] term, like over the next 10 years, I'

[27:44] I'd rather take my money that I would

[27:46] spend on shorts because I don't know

[27:48] that I can call that timing to that

[27:50] perfectly. I'd rather invest it into

[27:53] 10-year stocks, you know, stocks where

[27:54] I'm like, "Oh, okay. Well, there are

[27:55] some good deals on sales right now, and

[27:58] I want to go buy those." Like, you know,

[28:00] Robin Hood's almost at my $69 target. We

[28:02] don't own it in the Meet Kevin

[28:04] membership. We have 13 stocks that we're

[28:06] buying for the next 10 years. And you

[28:08] know, I want you to be a part of it, but

[28:10] you know, my hope is that in 10 years,

[28:11] we look back and we say, "Wow, out of

[28:13] those 13 stocks, you know, 12 of them

[28:15] were killers, like amazing winners." You

[28:18] know, I I mean, I don't think I'm going

[28:19] to have a 100% batting average, and I

[28:21] don't think anybody does, but um but uh

[28:24] yeah, I'm very very excited. Uh

[28:26] obviously, no guarantees, but I'm pretty

[28:28] excited. And so I actually like some of

[28:29] these discounts I'm seeing in fintech.

[28:31] You know, SoFi is is another one. Uh but

[28:34] there's also more competition coming up

[28:36] in banking. You know, one of my favorite

[28:39] um banks, Mercury, they uh they just uh

[28:44] got preliminary approval for their

[28:45] banking license. Uh so there's a lot of

[28:47] competition in this space for customers.

[28:50] You know, SoFi just reported and they're

[28:52] down 14%. I don't own any SoFi either.

[28:54] Uh but then at the same time you also

[28:56] had a Visa report and V dude Visa if you

[28:59] want to look at like an income statement

[29:02] and just have your draw drop in terms of

[29:04] how much freaking money Visa makes. It's

[29:07] insane. They literally make a Tesla

[29:10] worth of free cash flow every month. So

[29:15] the annual free cash flow that Tesla

[29:17] produces Visa generates every month. And

[29:22] Visa is like onethird the market cap of

[29:24] Tesla.

[29:26] It's crazy. It's It's Visa is actually

[29:29] not that expensive right now. You know,

[29:30] it's trading for like what was it? A 1.6

[29:33] peg here. I'll just pull it up. I'll

[29:35] show you.

[29:37] Uh Stonss,

[29:39] we have them at

[29:42] uh I wrote it down this morning. Where

[29:44] was it? Where was it? 1.8. Yeah. 1.8

[29:48] peg. and and you know their marketing

[29:51] went up a little bit because of the

[29:52] Olympics and people have like stable

[29:54] coin fears because of uh you know

[29:56] transact but honestly they're just going

[29:58] to make money with stable coins. That's

[29:59] my take. It's really incredible. So um

[30:03] Alex here says I'm shorting at 335.

[30:05] Definitely short-term definitely

[30:06] undervalued. Oh. Oh, you're making a day

[30:09] trade. Oh, okay. Yeah, yeah, yeah. Oh,

[30:11] so you're just using it as a proxy for

[30:13] Powell. Oh, well that's reasonable. Uh

[30:15] it's not just Powell, but also mega cap

[30:17] earnings. You have to be careful. You

[30:19] know, if you're going to hold it through

[30:20] the day, you got a lot of earnings

[30:21] coming up at the bell. So, earnings at

[30:23] the bell are uh you know, they're going

[30:26] to send a huge signal for uh mega cap

[30:29] spending. You know, the whole open AI

[30:31] hit piece yesterday in the Wall Street

[30:32] Journal I thought was a little

[30:34] overblown.

[30:36] Uh chat's gotten pretty good. They've

[30:38] caught up again to like Gemini and

[30:40] others. And uh this is just sort of part

[30:42] of the I do think they spend like

[30:44] drunken sailors but uh I I do think

[30:46] there's a lot of utility to these you

[30:48] know all of them anthropic Gemini chat

[30:51] uh perplexity actually is one of the

[30:55] they're not the first with this but they

[30:57] have a really cool feature called the

[30:59] model council and you could like enable

[31:02] three different bots and then like find

[31:04] consensus and differences between them.

[31:06] It does it all for you. Um, not the most

[31:09] detailed, but it's it's pretty cool. Uh,

[31:12] so so there's there's some pretty

[31:13] impressive stuff going on. Uh, so, okay,

[31:17] good, good, good. Uh, let's see here.

[31:20] What else? U, Tesla, you know, I I

[31:23] honestly do believe that Tesla, and this

[31:26] is not to be bearish Tesla, it just it's

[31:28] just a I can't call it a fact. It's just

[31:30] a strong opinion. That's a very strong

[31:32] opinion that it's going to be going back

[31:34] into the 200s, unfortunately. Uh, I

[31:38] think Elon's going to kind of keep

[31:39] sandbagging this one, uh, intentionally

[31:41] so he can acquire it. Uh, so I think

[31:43] it's all part of the greater plan, uh,

[31:46] if you will, which is, uh, unfortunate,

[31:48] but what we'll see. Even Palanteer's

[31:51] come down. You know, a lot of the

[31:52] software plays have really come down

[31:55] lately. I think Michael Bur's been

[31:57] watching too many meek Kevin member live

[31:58] streams and, you know, apparently now

[32:00] Michael Bur is like getting into

[32:02] Microsoft and software plays. And I'm

[32:04] like, dude, how many of my live streams

[32:05] have you been watching?

[32:07] Uh, six Iranian crew members of Iranian

[32:10] flag container ship uh, freed after

[32:13] seizure. 22 Iranians are still being

[32:15] held.

[32:17] Uh, I've got, you know, SanDisk as like

[32:20] the greatest hardware meme play. I mean,

[32:22] it's $158 billion market cap after like

[32:25] 10xing, right? It's gone from like 15 to

[32:28] 158. It's actually been pretty damn

[32:29] incredible. Uh, scary because, you know,

[32:33] this is going to be one of those heavy

[32:34] U-turns. It's a very cyclical play, but

[32:37] boy, uh, it's incredible. You know,

[32:39] Bloom had another rocket of, uh,

[32:41] earnings, pretty impressive as well.

[32:43] Also quite overvalued. Hardware is just

[32:46] a there are a lot of hardware plays that

[32:47] are quite overvalued, but it's still

[32:49] pretty impressive how the market's

[32:50] trading it. Uh, so we shall see. You

[32:54] know, even Dell breaking 200. Pretty

[32:56] impressive. Uh, Super Micro is the one

[32:59] getting left behind, but uh, but anyway,

[33:01] we've got Powell in about 14 minutes.

[33:04] We've got our bingo board ready already.

[33:06] We actually got it ready pretty early

[33:08] here. So, we got reference to achieving

[33:10] the soft landing. No talk of cuts. You

[33:13] know, I realize we, you know, we could

[33:15] put something else here. I don't know.

[33:16] It's probably cheating, but we usually

[33:17] don't do our bingo board until like

[33:19] right before Powell comes out. So, let's

[33:21] just kill the little myin piece right

[33:23] there. And we'll have like one little

[33:24] opening there. Um, so,

[33:30] you know, I put talk about consensus

[33:31] about rates staying stable on there. I

[33:34] think that'll still occur. Uh even

[33:36] though we didn't have a consensus vote.

[33:40] Uh so we'll be able to fill something in

[33:41] there.

[33:44] No, no, I I don't know when Tesla uh

[33:47] would go fall to 200. Uh I think a lot

[33:49] of that sort of just depends on uh you

[33:52] know the next two or three earnings. So,

[33:55] no, it's it's not something uh to short

[33:59] that I'm going to short, but I I I do

[34:01] think it's unfortunately like the the

[34:03] trajectory is obvious to where I don't

[34:05] want to buy it. Uh it's also a little

[34:08] pricey right now. A little It's like a

[34:10] five peg.

[34:14] Donald Trump, Iran has small percentage

[34:16] of missile making facilities

[34:19] because we obliterated them. Right. We

[34:22] shall see. We shall see. You know,

[34:25] another proxy for SpaceX stock has kind

[34:28] of uh settled down a little bit. See

[34:30] this here? This is SATS Echoar. They've

[34:32] got a good uh SpaceX exposure and the

[34:35] whole Elon stock comp plan to get, you

[34:37] know, a million people on Mars and a $7

[34:40] trillion valuation for SpaceX. In my

[34:43] opinion, that's just part of the IPO

[34:45] hype because he's trying to get people

[34:47] to go, "Oh, well, if it IPOs at$2

[34:49] billion dollars and Musk thinks it's

[34:50] going to go to seven, that's a three and

[34:53] a half bagger. I'm going to three and a

[34:55] halfx my money if I buy Space X so Elon

[34:58] can get paid." That's I think what he's

[35:00] trying to, you know, brand.

[35:05] So, uh, Trump suggested a bit of a

[35:07] ceasefire in Ukraine. A bit of a

[35:09] ceasefire. Interesting. Yeah. 24 hours.

[35:12] all have that war solved. Oh, that was

[35:14] just being satirical, right? Uh but

[35:17] anyway, uh what do you think happens

[35:19] with Spirit Airlines tomorrow? I don't

[35:20] know. You know, they've um it's no

[35:23] surprise that they entered bankruptcy

[35:24] proceedings. This back when we were

[35:26] doing fundamental analysis, but on on

[35:28] Spirit, but um you know, you could see

[35:31] when a company is trending towards

[35:32] bankruptcy. It's actually one of the

[35:34] features that we're working on in the

[35:36] Meet Kevin app where we uh we flag

[35:38] stocks based on the level of bankruptcy

[35:41] risk they have. So like if you see a

[35:43] cheap stock that is trending towards

[35:45] bankruptcy, at least you're aware of

[35:46] that as well. Uh so that'll be a cool

[35:48] feature. But um yeah, you know, Trump is

[35:51] sort of muse taking a stake in Spirit,

[35:54] which is odd. uh sort of nationalizing

[35:58] of a money losing business,

[36:02] but you know, Trump doesn't want to see

[36:04] job loss and he wants to come in as a

[36:05] hero. Uh it's it's sort of his way of

[36:08] buying votes, if you will.

[36:11] I think uh midterms are not going to be

[36:13] very uh pleasant to Trump, though. We

[36:16] shall see. Uh okay, what else do we

[36:19] have? We've got now 11 minutes until

[36:22] Powell comes out. Donald Trump spoke

[36:24] with Putin in a very positive exchange

[36:26] that covered both Ukraine and Iran.

[36:28] Trump told Putin, "I would rather he

[36:30] assist in bringing the war in Ukraine to

[36:33] an end." Adding that Iran possesses only

[36:36] a small fraction of his missing missile

[36:38] making facilities.

[36:42] I believe he might declare a ceasefire,

[36:44] possibly a small one, in the near

[36:45] future. So what? Putin could just

[36:48] unilaterally declare ceasefires

[36:50] probably.

[36:52] Um,

[36:53] I don't know. That sounds like Putin

[36:55] appeasing Trump. Oh, yeah. Maybe, you

[36:58] know, I saw your ceasefire. Good job.

[37:00] Maybe we do same. Yeah, Putin would like

[37:03] to be a, you know, I think I think Putin

[37:06] knows how to manipulate Trump really

[37:08] well. I think it's very interesting. Oh,

[37:09] he just wants to help. He's a good guy.

[37:12] He Putin's a good guy. He just want He

[37:14] just wants to help. He just wants to

[37:15] help, guys. You know, we're we're going

[37:17] to we're going to work out a small

[37:18] ceasefire.

[37:21] So he says, "Damn insiders, politicians

[37:23] making bank on oil." Yeah. Yeah, I know.

[37:26] It's uh the insider trading is probably

[37:28] the most extreme we've ever seen it.

[37:30] There's always been insider trading. It

[37:32] just seems to be uh more extreme today

[37:34] than ever before.

[37:36] Uh yeah, Circle 91 bucks. Uh it is uh I

[37:39] think we are sitting right Yeah, we got

[37:41] a line at 87 for it. It is uh it had a

[37:45] little bit of a euphoria there between

[37:48] uh 87 and 121. I actually broke past 121

[37:51] but uh

[37:55] yeah the integration of stable coins I

[37:57] think will become a big part of our

[37:58] financial future both uh you know you

[38:00] won't notice it. It'll be just built

[38:02] into banking and credit cards and

[38:04] everything. I think that's happening.

[38:07] been descending a lot lately about

[38:09] wanting to cut rates, but then three

[38:10] others actually trying to eliminate the

[38:13] bias toward easing rates down the line.

[38:16] Got a we swapped out our panel a bit.

[38:18] David Kelly, we invited you into the

[38:20] chamber of doom here. Jeff Kilberg

[38:22] joining us as well of KKM Financial on

[38:24] set. Jeff, um markets not moving. I

[38:27] think they're waiting for Jerome Powell

[38:29] and he didn't drop a bomb. He may still

[38:31] yet, but the four descents, should the

[38:35] market react to this? I don't think they

[38:37] need to react. But what this is to use a

[38:39] football analogy, this is a new

[38:41] quarterback hitting the portal. When you

[38:43] see a new quarterback coming in and

[38:44] Kevin Walsh in the old quarterback and

[38:46] Jerome Powell leaving, this was the rest

[38:47] of the players kind of letting him know,

[38:49] hey, we're not going to let you lead us

[38:51] here. So

[38:51] Trump hints that the war in Ukraine

[38:53] could conclude before the conflict with

[38:55] Iran.

[38:57] That's not good. That means Trump is

[39:00] getting quite bearish on Iran. That is

[39:05] not good.

[39:07] Uh, let me see what oil's doing right

[39:10] now.

[39:12] Ah,

[39:14] 11850.

[39:18] Wow.

[39:20] Yeah. So, that's not good. Let's go uh

[39:22] write that onto the uh geopol.

[39:25] Uh, Iran Trump hints

[39:29] uh war in Ukraine could conclude before

[39:32] war in Iran. This is bearish.

[39:36] uh Brent rockets to 11850.

[39:42] My warning signal, my warning price

[39:45] target is 120. Uh that's what we've had

[39:49] in uh course member discussions and on

[39:52] yesterday's video.

[39:55] Uh we're up, you know, quite a bit since

[39:58] then already.

[40:00] Uh okay, that's Gio.

[40:05] That's crazy.

[40:07] That is not good.

[40:10] Not good at all.

[40:11] I think another message to him that

[40:13] look, you're really going to have to

[40:14] talk with everybody in the committee.

[40:15] You're going to have to find consensus.

[40:17] You can't just steamroll a people with

[40:18] with with your your own ideas.

[40:21] Somebody here says Trump has uh messed

[40:22] up the Iran situation so bad and

[40:24] embarrassed America and will likely

[40:26] begin losing the petro dollar over this.

[40:29] I definitely think there's been some

[40:31] embarrassment regarding this. I I think

[40:32] the dollar still has uh quite a bit of

[40:34] strength, but you're right, like it it

[40:36] push pushes us down a messy uh track.

[40:39] You know, it' be nice not to have to

[40:41] deal with this sort of nonsense.

[40:43] Uh so,

[40:47] let's see. Uh speaks of Yeah, white

[40:50] collar crime. No, all the inception. It

[40:52] is. It is. But, you know, you have an

[40:54] administration that's actively

[40:57] instructing

[40:58] the

[41:01] DOJ and SEC to not enforce certain

[41:05] insider training. You know, I think they

[41:07] recently made an example of like some

[41:10] military sergeant or whatever. But

[41:12] notice how, you know, by no means is it

[41:15] any of the politicians or political

[41:17] folks involved up at the top. So, I feel

[41:19] like that was just a little bit Oh,

[41:21] yeah. Yeah. See, see, we are working on

[41:23] it. We are we are persecuting insider

[41:25] trading. It's like, no, you're not.

[41:28] Maybe that's just being jaded.

[41:32] Be fair to him. I mean, he, you know,

[41:33] this is a this is a new job. It's going

[41:35] to be u you know, he he deserves

[41:37] everybody's support going into this very

[41:39] important job. But I think you do have

[41:41] to ask questions about, you know, when

[41:42] he was on the Fed before, he definitely

[41:44] was hawkish. uh and then he's now in

[41:48] sort of the leadup to this he's

[41:49] expressed almost the opposite set of

[41:51] views and you just wonder what are the

[41:53] true views or how deeply held are those

[41:55] particular views

[41:56] and what Jim almost was saying and a lot

[41:58] of people feel this way a lot of people

[41:59] don't buy it but the but the

[42:01] cutting rates in September of 2024

[42:05] drone pal cut rates

[42:07] cuz the labor market was poop and I

[42:10] still don't know why

[42:11] are you kidding me the labor market was

[42:13] falling off a cliff you jackass you're

[42:15] just going to ignore for all the data

[42:17] inflation. I think getting back to a

[42:19] normal.

[42:19] We also had the Japanese carry trade

[42:21] crisis at the same time the labor market

[42:23] was falling off a cliff and this CNBC

[42:26] clown wants to pretend that we don't

[42:29] know why because you weren't paying

[42:31] attention dumbass is we don't know what

[42:34] transitory is unless the boats transit

[42:35] out of the straight of

[42:36] Hormuz and to your point crude oil is at

[42:39] 107

[42:41] and the other thing to think about in

[42:42] this oil issue is we we went into this

[42:45] massive stockpile of inventory around

[42:46] the world. We're working through that.

[42:48] But while we're working through that

[42:49] stockpile, we're not seeing the price

[42:51] effects. If this goes on another month,

[42:52] two months, three months, four months,

[42:54] we've got a real problem.

[42:55] You're talking my world. Now, Dave, I

[42:56] will say this, the the paper market that

[42:58] we show on the screen.

[42:59] I I agree. Uh it's uh CNBC does is

[43:03] starting to get a little embarrassing

[43:05] these days. I I I I listen to them less

[43:08] and less. Like I was on uh my trip to uh

[43:12] on my trip to New York, which is a great

[43:14] trip, by the way. highly recommend take

[43:17] your spouse on a trip to New York and go

[43:19] to, you know, a Broadway show or

[43:20] whatever and just mess around in New

[43:22] York. It's kind of fun, but um

[43:27] yeah, thanks to real estate and uh and

[43:29] stock analysis for letting us do that.

[43:31] But um remember you can join at

[43:33] meetke.com, use that coupon code. But um

[43:36] what am I trying to say? Uh, oh yeah, I

[43:38] was wa I was using the Vision Pro on the

[43:40] flight over uh and I had Bloomberg TV up

[43:45] while at the same time, you know,

[43:47] working whatever documents I was working

[43:49] on, some research or whatever. And uh

[43:53] as much as I don't like the Doomers,

[43:55] feel like it's uh it's better than CNBC

[43:58] lately. I I don't know what's changed

[43:59] lately. Maybe that's just a vibe I'm

[44:01] getting. So uh anyway, let's see what

[44:04] else we have here. we're not going to

[44:05] bail you out because you know the

[44:06] administration's got to figure out a

[44:08] solution to the problem in the Middle

[44:10] East. They've got to figure out a

[44:11] solution and if they assume that somehow

[44:13] the Fed is going to cut rates and that's

[44:15] going to fix things or something else

[44:16] going to happen to fix things that

[44:17] that's just just very bad strategy. So

[44:20] in a way the Fed's saying you you you

[44:22] got to deal with the the problems

[44:23] because we're not going to bail you out

[44:25] here.

[44:25] But it's almost a reminder that we're

[44:26] independent. Right.

[44:27] Exactly.

[44:28] One other thing I think about Francis

[44:29] Donald used the term fiscal dominance

[44:31] and was talking about and we all know

[44:32] this is true. look at the deficits and

[44:34] look at the way that kind of the fiscal

[44:36] side is dominating the business cycle.

[44:38] Is the Fed going to push back on that,

[44:40] David Kelly? And would a Worsh Fed put

[44:42] push back on that?

[44:43] No, I I think War to the extent that he

[44:45] has expressed a philosophy, it's really

[44:47] the Fed shouldn't. And I I agree with

[44:49] that that the Fed needs to have a small

[44:51] it should deal with the things it can

[44:52] deal with. It shouldn't try and deal

[44:53] with things it can't deal with. And you

[44:55] know, when you talk about fiscal, it's

[44:56] not so much fiscal, you know, the size

[44:57] of the deficit. It's a lot of decisions

[44:59] we're making in Washington. The

[45:01] vision pro are they actually useful? um

[45:04] for very very specific purposes. Uh like

[45:08] a plane is a great example I think where

[45:10] the vision pro is very useful because

[45:12] you do get a much larger workspace.

[45:16] Uh I much prefer

[45:20] in an office just having like two

[45:23] laptops or you know a couple computers

[45:25] or whatever. That's my preference. Uh, I

[45:29] actually like that a lot because I, you

[45:31] know, I noticed that even with newer Mac

[45:34] computers or even Windows computers,

[45:37] I could just run things better if I have

[45:39] multiple of them. Like right now in

[45:41] front of me, I have four computers and

[45:43] these are all Windows computers

[45:44] actually. And uh, actually that's not

[45:46] true. One of them is a Mac and then

[45:48] three of them are Windows computers. But

[45:51] it it's just been a lot easier to run

[45:53] video processing or video editing or you

[45:56] know uh news feeds or whatever on

[45:58] different computers so they just don't

[45:59] bog down the main frame you're working

[46:01] on. Um that is like the opposite with

[46:06] the Vision Pro, right? Everything's kind

[46:07] of squeezed into one device. Uh and and

[46:11] there are some limitations like you

[46:12] could you can't stream this I think is

[46:14] stupid. You can't you can't mirror to

[46:16] your phone and your laptop at the same

[46:19] time. So, like if I have my laptop

[46:22] mirrored to the Vision Pro and then I

[46:23] have a bunch of other windows open,

[46:24] that's great. But then I want to check

[46:26] my phone, I have to take the damn

[46:27] goggles off and and that's annoying. Uh

[46:30] like you should be able to mirror both

[46:32] your laptop and your phone to the Vision

[46:34] Pro. I don't know, maybe there's a new

[46:35] update that'll fix that or something.

[46:37] But that was that's been my experience

[46:39] with uh with it. But I I mean like you

[46:42] know outside of flying and then an

[46:45] extended flight at that,

[46:49] you know, is it really worth spending

[46:51] four grand on or whatever? No. I do hope

[46:54] Apple comes out with a foldable phone

[46:56] because I do wish my phone were larger.

[46:59] Like I wish I had a device that could

[47:01] fit in my pocket that could be larger

[47:05] than the phone

[47:07] but isn't as large as an iPad, right?

[47:10] right? Cuz that iPad doesn't fit in my

[47:11] pocket just so I could like read more

[47:14] easily. Not that I'm like going blind. I

[47:17] could see the text to my phone just

[47:18] fine, but I think more screen real

[47:20] estate would be nice, even just for like

[47:22] annotating and researching when I do.

[47:24] That's why I like the iPad, but I don't

[47:26] want to carry an iPad around everywhere.

[47:28] So, they get heavy. Yeah, the Mini's

[47:31] okay.

[47:33] Uh the Mini's The Mini is pretty good.

[47:35] Like, if you're going to go travel

[47:36] somewhere, the Mini's good. It doesn't

[47:38] weigh that much. You start, you put a

[47:40] keyboard case on an iPad Pro, it's like

[47:42] 4 lb.

[47:44] It's crazy. Then you may as well have a

[47:47] whole freaking Mac Pro laptop.

[47:51] It's crazy. Uh so

[47:55] yeah, iPad Mini though is is good. My my

[47:58] iPad mini screen is cracked and they're

[48:00] like, "Oh, it'll cost you $499 to

[48:02] replace it." I'm like, "I could just buy

[48:03] a new mini." And they're like, "Yeah,

[48:05] you want to buy a new mini?" And I'm

[48:07] like, "No, I'll just leave it cracked."

[48:10] I because I just I use it so little that

[48:13] I really don't care and it doesn't

[48:14] really affect the performance where the

[48:15] crack is. So, you know, and it's not

[48:18] about the money. It's like the hassle of

[48:21] setting up yet another device.

[48:27] Trump on Hormuzade. It has been genius.

[48:30] Uh-huh. Iran just has to say he give up.

[48:34] Yeah. Yeah. or perhaps his last ever

[48:35] press conference as Fed chair.

[48:40] Good afternoon.

[48:41] Yes.

[48:42] Uh my colleagues and I remain squarely

[48:44] focused on achieving our dual mandate

[48:46] goals of maximum employment and stable

[48:48] prices for the benefits benefit of the

[48:50] American people. The US economy has been

[48:53] expanding at a solid pace. While job

[48:55] gains have remained low, the

[48:57] unemployment rate has been little

[48:58] changed in recent months. Inflation has

[49:01] moved up and is elevated in part

[49:03] reflecting the recent increase in global

[49:05] energy prices.

[49:07] Today, the FOMC decided to leave our

[49:10] policy rate unchanged.

[49:12] We see the current stance of monetary

[49:14] policy as appropriate to promote

[49:16] progress toward our maximum employment

[49:18] and 2% inflation goals.

[49:21] Developments in the Middle East are

[49:23] contributing to a high level of

[49:24] uncertainty about the economic outlook

[49:26] and we will remain attentive to risks to

[49:28] both sides of our dual mandate. I'll

[49:31] have more to say about monetary policy

[49:33] after briefly reviewing economic

[49:35] developments.

[49:37] Recent indicators suggest that economic

[49:39] activity has been expanding at a solid

[49:41] pace. Consumer spending has been

[49:44] resilient and business fixed investment

[49:46] has continued to expand at a brisk pace.

[49:49] In contrast, activity in the housing

[49:51] sector has remained weak.

[49:54] In the labor market, the unemployment

[49:56] rate was 4.3% in March and has changed

[49:59] little in recent months. Job gains have

[50:02] remained low. A good part of the slowing

[50:05] in the pace of the job growth over the

[50:07] past year reflects a decline in the

[50:08] growth of the labor force due to lower

[50:11] immigration and labor force

[50:12] participation, though labor demand has

[50:15] clearly softened as well.

[50:17] Other indicators, including job

[50:19] openings, layoffs, hiring, and nominal

[50:21] wage growth, generally show little

[50:23] change in recent months.

[50:27] Inflation has moved up recently and is

[50:29] elevated relative to our 2% longer run

[50:32] goal. Estimates based on the consumer

[50:34] price index and other data indicate that

[50:37] total PCE prices rose 3.5% over the 12

[50:40] months ending in March, boosted by the

[50:43] significant rise in global oil prices

[50:45] that has resulted from the conflict in

[50:47] the Middle East.

[50:49] Excluding the volatile food and energy

[50:51] categories, core PCE prices rose 3.2%

[50:54] over the 12 months ending in March. This

[50:57] relatively high rate largely reflects

[50:59] the effects of tariffs on prices in the

[51:01] goods sector.

[51:03] Near-term measures of inflation

[51:04] expectations have risen this year,

[51:06] likely because of the substantial rise

[51:08] in oil prices.

[51:11] Most measures of longerterm expectations

[51:13] remain consistent with our 2% inflation

[51:15] goal.

[51:17] Our monetary policy actions are guided

[51:19] by our dual mandate to promote maximum

[51:21] employment and stable prices for the

[51:23] American people. At today's meeting, the

[51:26] committee decided to maintain the target

[51:27] range for the federal funds rate at 3

[51:29] and a half to 3 and 3/4%.

[51:32] The economic outlook remains highly

[51:34] uncertain and the conflict in the Middle

[51:36] East has added to this uncertainty.

[51:39] In the near term, higher energy prices

[51:41] will push up overall inflation. Beyond

[51:44] that, the scope and duration of

[51:46] potential effects on the economy remain

[51:48] unclear, as does the future course of

[51:50] the conflict itself.

[51:52] We will continue to monitor the risks to

[51:54] both sides of our dual mandate. We are

[51:57] well positioned to determine the extent

[51:58] and timing of additional adjustments to

[52:00] our policy rate based on the incoming

[52:02] data, the evolving outlook, and the

[52:05] balance of risks.

[52:07] Monetary policy is not on a preset

[52:09] course, and we will make our decisions

[52:11] on a meeting by meeting basis.

[52:14] There we go.

[52:15] This is my last press conference as

[52:17] chair, and I will close with a few

[52:19] thoughts. First, I want to congratulate

[52:21] Kevin Walsh on his advancement out of

[52:23] the Senate Banking Committee this

[52:25] morning. This is an important step

[52:27] forward and I wish him well as that

[52:29] process continues.

[52:32] The Federal Reserve exists for one

[52:34] fundamental purpose to foster the

[52:36] economic conditions in which American

[52:38] families and businesses can thrive.

[52:40] Stable prices, a strong job market, and

[52:43] a financial system they can depend on.

[52:46] Every decision we make, whether about

[52:48] interest rates or regulatory and

[52:49] supervisory matters or other issues, is

[52:52] made in service of that purpose.

[52:55] Our decisions reflect the collective

[52:56] judgment of the board of governors and

[52:58] the federal open market committee.

[52:59] Colleagues who demonstrate analytical

[53:01] rigor, principled judgment, and a

[53:03] genuine commitment to the public

[53:05] interest. Our collaborative and

[53:07] deliberative process has long reflected

[53:09] a shared commitment to finding common

[53:11] ground in service to our mission.

[53:15] This institution is resilient, capable,

[53:17] and staffed by professionals of

[53:19] extraordinary talent and exceptional

[53:21] dedication. It has been a privilege to

[53:23] serve alongside so many great public

[53:26] servants at the board of governors and

[53:28] around the Federal Reserve system.

[53:31] The Fed's work is only as effective as

[53:33] the public's understanding of it. And

[53:35] you, the press, are essential to keeping

[53:37] the public informed about we about what

[53:39] we do and why. The people we serve,

[53:41] benefit from your careful reporting.

[53:46] I welcomed the announcement last Friday

[53:48] by the US attorney for the District of

[53:50] Columbia that she had closed the

[53:52] criminal investigation. She also noted,

[53:54] however, that she would not hesitate to

[53:56] restart the investigation.

[53:57] Uh-oh. Over the weekend, the Department

[54:00] of Justice provided assurances that they

[54:02] will not reopen the investigation unless

[54:04] there's a criminal referral from the

[54:06] Fed's inspector general. And absent such

[54:09] a referral, if they do appeal the recent

[54:11] court decision, they would not seek, as

[54:13] part of that appeal, to restart the

[54:15] investigation or send new subpoenas.

[54:20] I said that I will not leave the board

[54:22] until this investigation is well and

[54:24] truly over with transparency and

[54:26] finality, and I stand by that.

[54:28] I'm encouraged by recent developments,

[54:30] and I'm watching the remaining steps in

[54:33] this process carefully.

[54:36] My decisions on these matters will

[54:37] continue to be guided entirely by what I

[54:39] believe is in the best interest of the

[54:41] institution and the people we serve.

[54:44] After my term as chair ends on May 15, I

[54:46] will continue to serve as a governor for

[54:48] a period of time to be determined. Wow.

[54:51] I plan to keep a low profile as a

[54:53] governor. There's only ever one chair of

[54:56] the Federal Reserve Board. When Kevin

[54:58] Worsh is confirmed and sworn in, he will

[55:01] be that chair. Once sworn in as board

[55:03] chair, his new colleagues will elect him

[55:05] to chair the FOMC as well.

[55:07] Wow.

[55:09] As I regularly point out from this

[55:11] podium, our success in delivering our

[55:13] goals matters for all Americans. I'm

[55:16] confident that that the Fed will

[55:17] continue to do its work with

[55:18] objectivity, integrity, and a deep

[55:21] commitment to serve the American people.

[55:24] Thank you, and I look forward to your

[55:25] questions. A

[55:33] Thank you, Mr. Chair. Appreciate the

[55:34] kind words about the press. Often

[55:35] doesn't come from the podium in

[55:37] different places, but appreciate that.

[55:39] Um, can you talk about what is gone into

[55:41] your decision to remain on the board?

[55:43] What kind of criteria are you weighing

[55:45] and uh how long might you stay? Thank

[55:47] you.

[55:48] Sure. So, you know, my my concern is

[55:51] really about the series of legal attacks

[55:53] on the Fed, right,

[55:54] which threaten our ability to conduct

[55:56] monetary policy without considering

[55:57] political factors. And I I want to note

[56:00] here, this has nothing whatever to do

[56:02] with verbal criticism by elected

[56:03] officials. Uh I I've never suggested

[56:06] that such ver verbal criticism is a

[56:08] problem and neither has anyone else

[56:09] here. But these legal actions by the

[56:12] administration are unprecedented in our

[56:14] 113year history and there are ongoing

[56:16] threats uh of additional such actions. I

[56:19] I worry that these attacks are battering

[56:21] the institution and putting at risk the

[56:23] thing that really matters to the public,

[56:25] which is the ability to conduct monetary

[56:27] policy without taking into consideration

[56:29] political factors.

[56:30] Right?

[56:31] It is so important for our economy, for

[56:33] the people that we serve, that they can

[56:35] depend over time on a central bank that

[56:37] operates that way free of political

[56:39] influence.

[56:40] Good for you.

[56:40] It's part of the absolute foundation of

[56:42] this amazing economy that we have. It's

[56:44] just one of the many reasons why the US

[56:47] economy is the env en envy of the world.

[56:49] Hell yeah.

[56:49] That piece of institutional architecture

[56:52] separates successful countries from

[56:53] unsuccessful countries.

[56:55] Yep.

[56:55] It is extremely important not for the

[56:57] people who work at the Fed at any given

[56:59] time, but for the people that we serve

[57:01] that the Fed remain able to conduct

[57:02] monetary policy in a way that doesn't

[57:04] get pulled into politics trying to help

[57:06] or hurt any particular politician or

[57:08] political party. It's critical for the

[57:10] people that we serve. In terms of when I

[57:13] would leave, I I will leave when I when

[57:15] I think it's appropriate to do so. Was

[57:17] that all your questions or was that

[57:18] Well, I just have a followup, which is

[57:20] what would you say to the criticism that

[57:22] by remaining on the board, you're

[57:23] actually taking a political act and

[57:25] denying uh President Trump the majority

[57:28] of the board, which as president he

[57:29] would have if you left.

[57:31] I I don't see that at all. As I

[57:33] mentioned, uh you know, I'm literally

[57:35] staying because of the actions that have

[57:37] been taken. I I had long planned to be

[57:39] retiring. Uh and uh you know the things

[57:42] that have happened in really in the last

[57:43] three months have have I think left me

[57:45] no choice but to stay until till I see

[57:47] them through at least that long. Um you

[57:50] know in addition uh I don't see how this

[57:54] will interfere. My intention is not to

[57:56] interfere. You know, I was a governor

[57:57] for almost six years, and the tradition

[58:00] is at the Fed that governors uh who

[58:03] understand how difficult the role of

[58:05] chair is, and as a as a soontobe former

[58:07] chair, I do understand how hard it is to

[58:09] get consensus with 19 strong-minded

[58:12] people, you work with the chair. You you

[58:14] try to you try to uh be heard, but also

[58:19] collaborate with the chair and try to

[58:21] support the chair when you can. When you

[58:22] can't, you can't. And I think that's the

[58:24] attitude that people generally take. And

[58:26] that's the attitude that I'll take.

[58:27] Good for him. You know what? What a

[58:30] badass to actually stand up to these

[58:31] attacks, though. He's actually fighting

[58:34] for like what political institutions

[58:36] should be. In March, you described the

[58:41] standard practice of looking through

[58:42] energy shocks as conditional on

[58:45] inflation expectations staying anchored.

[58:48] Since that meeting, there has been very

[58:50] little progress reopening uh key energy

[58:52] trade corridors. Can you help us

[58:54] understand how the inflation outlook has

[58:57] changed in the intermedating period

[58:59] beginning with the prospects for tariff

[59:01] pass through resolving on the timeline

[59:02] that you had outlined in March before

[59:05] getting to the energy shock that is now

[59:07] on top?

[59:08] So, you know,

[59:10] I would look at it this way. Um, for a

[59:14] long time, we've been working on on the

[59:17] hypothesis really that tariff uh tariffs

[59:21] would would lead to a one-time price

[59:22] increase and that that would go away

[59:24] over time. In other words, that there

[59:25] would be no further change. So, measured

[59:27] inflation wouldn't reflect that higher

[59:29] level going up more and more. And it's

[59:32] time for that to happen. You know, we

[59:34] really do expect that to be happening in

[59:36] the next two quarters. So, we'll be

[59:38] watching very carefully to see that what

[59:40] we've thought all along would happen.

[59:41] That's the kind of critical part of the

[59:43] forecast. We we need to really see that

[59:46] with with energy. It's it's so hard to

[59:48] say. Um I I mentioned you know in you

[59:51] know sort of the textbook you you would

[59:53] look through it an oil shock because

[59:55] they tend to be shortlived and they tend

[59:56] to revert and monetary policy works with

[59:59] long and variable lags. So you you know

[1:00:01] you wouldn't necessarily re react right

[1:00:03] away. I think that is all the more true

[1:00:05] given that we're several years above 2%

[1:00:08] inflation and that we're already looking

[1:00:10] through the tariff shock.

[1:00:12] Yeah, you're right, Teddy. Good comments

[1:00:13] in the chat. I agree with you.

[1:00:14] But the the question about about looking

[1:00:16] through energy really is not not in

[1:00:18] front of us right now. We it hasn't even

[1:00:20] peaked yet. And I think we'd want to see

[1:00:22] the backside of that and progress on

[1:00:24] tariffs before we even thought about uh

[1:00:27] about reducing rates. So, if I could

[1:00:29] follow up, the the statement today

[1:00:31] preserves language that has taken on

[1:00:33] some meaning uh as it was socialized

[1:00:35] when the committee was actively lowering

[1:00:37] rates. Why is that easing bias still uh

[1:00:42] ripe given how different the inflation

[1:00:44] outlook is now versus a meeting or two

[1:00:47] ago? And what more would have to happen

[1:00:50] for it to get evicted? So um that was uh

[1:00:54] as you will recall we we had a

[1:00:55] discussion about that at the last

[1:00:57] meeting and we talked about it in in the

[1:00:59] press conference after the March

[1:01:00] meeting. We had the same today. We had

[1:01:02] quite a vigorous discussion about that

[1:01:03] that very issue and the guidance and is

[1:01:06] it still appropriate and that kind of

[1:01:07] thing. And I would say that the you know

[1:01:09] number of people on the committee who

[1:01:11] either could support that ch language

[1:01:13] change changing to a more neutral stance

[1:01:16] so that a hike is as likely as as a cut.

[1:01:20] that number has increased over the

[1:01:21] intermedating period and it's easy to

[1:01:23] see why. I mean, it's it's a it's it's a

[1:01:26] good question, right? You see inflation

[1:01:27] has moved up over the interim a bit.

[1:01:30] Core inflation's 3.2 now, moving albeit

[1:01:33] just a little bit, in the wrong

[1:01:34] direction. And we we know that there

[1:01:37] will be, you know, that there's uh

[1:01:39] headline inflation coming out of the

[1:01:41] Gulf. And we don't know how much that

[1:01:42] will be. We just we're going to need to

[1:01:45] see. So, it makes all the sense in the

[1:01:47] world that people would look at that and

[1:01:48] and we'd have a vigorous discussion

[1:01:50] about that. You saw that three people

[1:01:52] desented over the language. I think all

[1:01:54] of those people agreed with the with the

[1:01:56] rate decision. Um, so the majority of

[1:01:59] the committee did not want to do that

[1:02:01] and and and I I was I didn't think we

[1:02:03] needed to do it at this meeting. It

[1:02:04] really was just a question of what's why

[1:02:07] do we need to do that now? You know, we

[1:02:09] have so much to learn. There's so much

[1:02:10] uncertainty about the path ahead. There

[1:02:12] doesn't need to be any rush to make that

[1:02:14] decision now.

[1:02:15] No rush is a big thing that we've been

[1:02:17] talking about. And Teddy in the comments

[1:02:18] here, you're right on. I mean, really,

[1:02:20] these shocks after shock keep inflation

[1:02:22] elevated for the shorter period of time.

[1:02:24] Hopefully by uh 2032. My goal, you know,

[1:02:27] rates are way down again. Probably will

[1:02:29] be, but like Jerome Pal says, no cuts

[1:02:31] basically until we get through this oil

[1:02:32] and tariff shock.

[1:02:34] Claire,

[1:02:37] Claire Jones, Financial Times. Um just

[1:02:40] just going back to this issue of the the

[1:02:43] easing bias. Um we've now got oil

[1:02:46] approaching $120 a barrel when it comes

[1:02:49] to benchmark.

[1:02:50] That's the number.

[1:02:51] Bren crude. Um if it stays around those

[1:02:55] levels 6 weeks from now, what would be

[1:02:57] your guess best guess as to whether the

[1:02:59] easing bias will still be in the

[1:03:01] statement? Thank you.

[1:03:02] Hold. I wouldn't want to guess. you

[1:03:04] know, well, first of all, we're going to

[1:03:05] have new leadership in all likelihood by

[1:03:07] then and and new leadership is going to

[1:03:09] have a very important role to play in

[1:03:10] that. So, uh, I won't be standing here

[1:03:12] at this podium to answer your question.

[1:03:14] So, um, I don't know. As I mentioned,

[1:03:17] that's all I can really say is that we

[1:03:19] had we had a great discussion about that

[1:03:20] today. It's a, you know, it's it got

[1:03:22] it's gotten to be a better question than

[1:03:24] the interim period. We had the

[1:03:25] discussion a majority are still on the

[1:03:27] page of of not feeling the need to move

[1:03:30] to that level. And I I that's where I

[1:03:31] am.

[1:03:32] Yeah. Uh I I get it though, you know, at

[1:03:34] a certain point you would move and that

[1:03:36] that conceivably could come as soon as

[1:03:38] the next meeting.

[1:03:39] Thank you. Just to follow up on um the

[1:03:42] new leadership also seem

[1:03:43] conceivably move as soon as next

[1:03:45] meeting. I don't think they're going to

[1:03:47] move. I think they're going to hold. You

[1:03:49] know, you don't want to pull a 1970s and

[1:03:51] really screw with people's expectations,

[1:03:53] which really affects inflation as well

[1:03:54] today here. But I've you know uh I I

[1:03:57] think communications generally is uh I

[1:03:59] think every incoming chair takes a look

[1:04:01] at communications and it's a very

[1:04:03] healthy thing. I mean communications

[1:04:05] it's very complex and uh you know you

[1:04:08] can always be uh be looking at new

[1:04:10] things and and I if that happens feels

[1:04:13] like it's going to happen that's

[1:04:14] completely appropriate thing.

[1:04:19] Hi chair chair pow with Axios. Um can

[1:04:22] you tell us if you've been uh in touch

[1:04:24] with with incoming chairman Worsh uh any

[1:04:27] uh to what extent is this a normal

[1:04:29] transition process versus all the things

[1:04:31] swirling around uh something unusual and

[1:04:33] and what can we expect when when he

[1:04:35] takes uh takes that podium in a few

[1:04:37] weeks?

[1:04:37] I I haven't seen him since uh seeing him

[1:04:39] at a dinner in January where I

[1:04:41] congratulated him and had a nice nice

[1:04:43] chat with him. Haven't seen him. I don't

[1:04:44] know what a normal process is. you know,

[1:04:46] the the last process was with uh Janet

[1:04:48] Yellen, who with whom I had worked for 6

[1:04:50] years, and so it was a you know, we were

[1:04:52] sitting down the hall from each other,

[1:04:53] so it was a very different thing. I

[1:04:55] think I think this is and will be a very

[1:04:57] normal standard kind of a kind of a

[1:04:59] transition process. So that's that's

[1:05:01] what I expect. I have every reason to

[1:05:02] think it will be.

[1:05:03] Quick followup. Is the Supreme Court

[1:05:04] ruling on Governor Cook a factor in when

[1:05:06] you may leave as a governor?

[1:05:08] I wasn't thinking of it as such, but no,

[1:05:11] not really. I mean, I'm thinking more of

[1:05:13] the other things I mentioned.

[1:05:16] Chris.

[1:05:19] Hi. Uh, thanks for taking our question.

[1:05:21] I wanted to ask a question about your

[1:05:23] tenure and Chris Rugverber at Associated

[1:05:25] Press.

[1:05:26] Who's the blogging?

[1:05:26] Um, during your tenure as chair, you

[1:05:28] often spoke about how disadvantaged

[1:05:30] Americans benefited from extended

[1:05:32] periods of low unemployment. Uh, and the

[1:05:35] new framework the Fed adopted in 2020,

[1:05:37] some economists say elevated the Fed's

[1:05:39] employment mandate. Uh, are you worried

[1:05:41] that the the pandemic inflation spike

[1:05:44] that followed will make future Fed

[1:05:46] chairs more reluctant to pursue a hot

[1:05:48] jobs market and should they be?

[1:05:52] No. Um, I don't know the answer to that.

[1:05:56] I mean what we so what we experienced

[1:05:59] um

[1:06:00] in in uh the in the teens, the mid-

[1:06:03] teens was uh really low low levels of

[1:06:07] unemployment

[1:06:08] for a long period of time and no

[1:06:10] reaction from inflation and we all took

[1:06:12] very much took notice of that. We also

[1:06:15] noticed that the biggest wage gains were

[1:06:18] going to people at the bottom end of the

[1:06:20] income spectrum. And we had many many

[1:06:22] reports of uh I mean it felt like a

[1:06:25] fairly stable equilibrium and a lot of

[1:06:27] benefits were flowing to people at the

[1:06:29] bottom end of the uh income spectrum

[1:06:31] including companies were you know

[1:06:33] setting up in um in you know people who

[1:06:37] were confined and and like training them

[1:06:40] before they got out and it was it was a

[1:06:42] very healthy sort of set of societal

[1:06:43] dynamics.

[1:06:44] So, of course, I think anybody would

[1:06:46] love to get back to that. Um, I I don't

[1:06:49] think that anything that happened to

[1:06:53] create the the global pandemic inflation

[1:06:55] was in any any way related to

[1:06:58] overweighting the employment market. I

[1:06:59] mean, it was it was a global shock that

[1:07:01] happened essentially very very similarly

[1:07:03] all over the world that had to do with

[1:07:05] closing, reopening, stimulus, and all

[1:07:08] that. And I mean you could you could

[1:07:09] look at a graph of 10 big economies on

[1:07:12] the page and not know which was the US

[1:07:14] and which was Germany, France and things

[1:07:15] like that. So I don't think that that

[1:07:18] that insight was in any way responsible

[1:07:21] for the high inflation that we

[1:07:23] experienced. So I mean I think it's

[1:07:25] always been a balance. uh uh you you've

[1:07:29] got to you've got to be strong on both

[1:07:32] of our dual mandates and we we just for

[1:07:35] example now we we don't feel that the uh

[1:07:37] labor market is at all a source of

[1:07:39] inflation so we don't need to be

[1:07:40] worrying about that. It's been a long

[1:07:41] time since we have had to worry about

[1:07:42] that. Well actually during the during

[1:07:44] the pandemic recovery the labor market

[1:07:46] was super overheated and tight and

[1:07:48] that's when we had to worry about it but

[1:07:50] but not now. And just on the other

[1:07:52] issue, um are you would you need do you

[1:07:55] need more assurance from the Justice

[1:07:57] Department before stepping down? Is that

[1:07:59] what you're waiting for or what else?

[1:08:02] You know, for the for the investigation

[1:08:03] to be well and truly over with finality

[1:08:06] and transparency

[1:08:08] and I'm waiting for that and I will

[1:08:11] leave when I think it's appropriate to

[1:08:12] do so.

[1:08:13] Yeah. Fair. A quick reminder since it's

[1:08:16] his last meeting as Fed chair, coupon

[1:08:18] code goodbye Powell is live both at meet

[1:08:21] Kevin.com and househ.com if you want

[1:08:23] that real estate AI valuation AI comes

[1:08:25] out at the uh end of June.

[1:08:27] View and interest rates because there

[1:08:30] were some members of the open market

[1:08:31] committee who've been suggesting that we

[1:08:33] may need to raise interest rates even

[1:08:36] absent the war because inflation was not

[1:08:38] coming down fast enough. Uh is there any

[1:08:42] sense that interest rates might have to

[1:08:44] go up or was this just a setup to sort

[1:08:47] of uh warn people that you're worried

[1:08:51] about the war impacts?

[1:08:53] So nobody the three denters and and

[1:08:56] others who could have supported that and

[1:08:58] others who were you know who were voters

[1:09:00] and prefer non- voters who preferred it

[1:09:02] they all supported the right decision.

[1:09:04] Right? So people are not saying we need

[1:09:06] to hike now. It's more a question of you

[1:09:09] know don't we kind of feel that we

[1:09:11] should be neutral and markets are

[1:09:13] markets what are markets doing people

[1:09:15] argue that's this is consistent what

[1:09:17] markets are doing and again it's a it's

[1:09:20] a very fair question but you know these

[1:09:21] these changes there is you know it's a

[1:09:23] form of forward guidance and you want to

[1:09:26] make you don't want to make them you

[1:09:28] want to make them in a way that that

[1:09:30] will be sustained and continue to make

[1:09:31] sense and not something you need to take

[1:09:33] back uh you know fairly quickly. So I I

[1:09:36] think we just a group of us including me

[1:09:39] didn't feel like we needed to be in a

[1:09:41] hurry on that that that markets are not

[1:09:43] confused about our reaction function. We

[1:09:45] don't have a problem to solve on that.

[1:09:46] But the other side of the argument is a

[1:09:48] good argument too. As I as I mentioned

[1:09:49] it's a perfectly good argument to be

[1:09:52] having good discussion to be having. So

[1:09:54] and it came out the way it came out.

[1:09:55] Well you've got uh three descents uh in

[1:09:58] favor of uh two-sided uh warning. Uh

[1:10:02] you've got yourself staying on the

[1:10:04] board. You've got the criticism that

[1:10:06] does come from elected officials uh and

[1:10:09] you've got a lot of uh critics who have

[1:10:11] faulted the Fed for being too slow 2021

[1:10:15] with inflation. Are you worried about

[1:10:18] Fed credibility under all of this? Is

[1:10:20] that one reason that you want to stay

[1:10:22] on?

[1:10:24] Not not driving my my thinking now. I

[1:10:26] mean, monetary policy is going to get

[1:10:28] made by, you know, 19 people. There's a

[1:10:32] lot of stability there. Uh I mean if you

[1:10:35] think about it any every new fair Fed

[1:10:38] chair has the same situation which is

[1:10:41] you've got 18 colleagues on the FOMC 11

[1:10:44] of them vote during any year and you

[1:10:46] have to your job is to create consensus

[1:10:50] is it's to talk to them understand them

[1:10:52] you know be inside their thinking and be

[1:10:55] able to pull them together and and get

[1:10:57] consensus and move. And that's that's

[1:10:59] what every Fed chair has to do. And I I

[1:11:02] think Kevin Wars is actually quite well.

[1:11:04] He has the capabilities, skills to be to

[1:11:07] be very good at that, I would think. So

[1:11:09] I think I I'm not so worried about that

[1:11:11] process, you know. Uh I think that'll

[1:11:14] that'll work itself out.

[1:11:17] Howard,

[1:11:19] uh thank you, Chair. Howard Schneider

[1:11:21] with Reuters. You you mentioned that uh

[1:11:23] staying on as a governor, you intend to

[1:11:25] keep a low profile. I'm just wondering

[1:11:27] if you could give us a little more

[1:11:28] detail on what that looks like and how

[1:11:30] you can

[1:11:32] touch Touche

[1:11:35] um what that Yeah. walk down the steps.

[1:11:37] Uh what that looks like and particularly

[1:11:39] around the policy discussion, how you're

[1:11:41] able to uh to have your intervention and

[1:11:44] not be a shadowed chair and not have

[1:11:47] kind of an outsized influence over the

[1:11:49] process.

[1:11:49] Yeah. You know, that's just something I

[1:11:51] would never do. You know, the shadow

[1:11:52] chair thing. you know, you know, it's

[1:11:53] it's I I don't know what the exact

[1:11:55] specifics of it will be, but I'm going

[1:11:58] back to being a governor. I respect the

[1:12:00] role of chair. I you know, I was a

[1:12:02] chair. I was a governor for 6 years, and

[1:12:04] I know what that's like. I know and I I

[1:12:06] had a, you know, pretty front row seat

[1:12:09] with particularly with with Chair Yellen

[1:12:10] to whom I I was close when I when I I

[1:12:12] was worked with Chairman Bernani for two

[1:12:14] years. But, um, you know, I I I was

[1:12:17] brand new at that time. So I got a sense

[1:12:19] of what it was and I had real sympathy

[1:12:20] for how hard it is to get that group to

[1:12:24] consensus and I always felt like I you

[1:12:26] know I don't want to add to that

[1:12:27] unnecessarily and that means try to

[1:12:29] support the chairs where the chair the

[1:12:31] direction the chair wants to go in if

[1:12:32] you can. If you can't you can't but and

[1:12:34] I think that's that's the way it's

[1:12:36] always worked there because the chair

[1:12:37] only has one vote plus the ability to

[1:12:39] develop consensus and if people won't be

[1:12:42] you know they they won't if they're not

[1:12:44] flexible at all then how do you ever do

[1:12:46] that? And so that's why the chair has

[1:12:48] the authority the chair has really is to

[1:12:51] develop relationships with people and

[1:12:52] work with them and then and then put

[1:12:54] something forward that has consensus and

[1:12:56] I you know I I prop I propose to be a

[1:12:58] very constructive participant in that

[1:13:01] process uh really out of respect for for

[1:13:04] the office of the chair

[1:13:05] and uh in your view as a a soontobe

[1:13:09] governor how do you see the risks of oil

[1:13:12] prices bleeding into core inflation in

[1:13:14] coming weeks because that was it seems

[1:13:17] like the commentary that was coming from

[1:13:19] particularly some of the Reserve Bank

[1:13:20] presidents there were elevated concerns

[1:13:21] about the bleed into core and you know

[1:13:24] here we are with three descents now what

[1:13:25] do you see as the prospect of of of a

[1:13:27] core inflation

[1:13:28] you know they're those prospects are

[1:13:30] real remember though our are u and

[1:13:32] they're real and the real thing is we're

[1:13:34] going to have to wait and see we're

[1:13:36] going to need to see and the good news

[1:13:37] is we think our policy stance is just is

[1:13:39] in a very good place for us to wait and

[1:13:41] see we you know we're right kind of at

[1:13:44] the high end of neutral or perhaps

[1:13:46] mildly restrictive. U the labor market

[1:13:49] shows more and more signs of stability

[1:13:52] whereas inflation is kind of misbehaving

[1:13:54] and so maybe a little bit of uh of

[1:13:57] restriction or the high end of neutral

[1:13:58] is just the right place to be. So we can

[1:14:00] wait here and see uh and see how things

[1:14:03] work out before we act and we'll see how

[1:14:06] much that you know how much does come

[1:14:08] through into core. You see it already in

[1:14:09] air airfares of course but you may see

[1:14:11] it in many other places. Uh you know uh

[1:14:15] we just don't know yet and it's it's so

[1:14:17] unknowable because how how long will the

[1:14:18] straight be closed? You can develop any

[1:14:21] number of scenarios that you want but we

[1:14:23] really won't know till we know. So

[1:14:25] fortunately we're in a good place to to

[1:14:27] wait and let things develop.

[1:14:34] Uh thanks Mr. Chairman. um you started

[1:14:36] holding post uh post meeting press

[1:14:38] conferences for every meeting as opposed

[1:14:39] to the ones with just uh with SCPs. Can

[1:14:42] you talk about why you see that as a net

[1:14:44] positive? So we um we always said when

[1:14:48] we were doing quarterly press

[1:14:49] conferences, we always said we can move

[1:14:51] at any meeting, but we only ever moved

[1:14:52] at the quarterly SCP meetings where we

[1:14:54] had the press conference. So if you

[1:14:56] think about it, you know, we during the

[1:14:58] pandemic, we were moving like a lot at

[1:15:00] every meeting and sometimes between

[1:15:02] meetings and and doing that with our

[1:15:04] press conference, I think would have

[1:15:05] been quite challenging. It's become the

[1:15:06] industry norm.

[1:15:08] It's the standard.

[1:15:09] I don't know whether that has to remain

[1:15:11] that way. I don't know. I mean I it's

[1:15:12] it's just something people have become

[1:15:14] used to and I I do think it's quite

[1:15:15] helpful to you know to uh I mean I I I

[1:15:19] try to deliver a message on behalf of

[1:15:21] the committee rather than 18 people 18

[1:15:24] other people going out and delivering

[1:15:25] their message and it's you know it's

[1:15:26] going to be all over the place because

[1:15:28] we do thankfully have widely disperate

[1:15:30] views.

[1:15:32] Um okay thanks. The other thing I wanted

[1:15:34] to ask about was the communications

[1:15:36] review from last year. Um uh could you

[1:15:39] describe the debate last year? what

[1:15:41] changes were considered, what you

[1:15:42] wanted, and what prevented action um any

[1:15:45] action uh on the on on those changes.

[1:15:48] So, I'm not going to go into the the

[1:15:50] real small specifics, but what we found

[1:15:54] very quickly was that

[1:15:57] um making making changes making really

[1:16:01] large changes, for example, to the DOT

[1:16:03] plot or the SCP

[1:16:05] um it it didn't have we couldn't come up

[1:16:09] with anything that had really broad

[1:16:10] support on the committee and and so we

[1:16:13] just didn't we we didn't really do as

[1:16:14] much on on that as we might have. And uh

[1:16:18] you know I was never the world's biggest

[1:16:19] fan of the dot plot but you you can't

[1:16:21] can't beat something with nothing. And

[1:16:23] you know there's a that we've looked at

[1:16:25] a bunch of things and uh you know it's

[1:16:28] something I like I said I think every

[1:16:30] new chair is going to look at our suite

[1:16:32] of communications and and think about

[1:16:35] what would be changes. We we are the

[1:16:38] only major central bank that doesn't

[1:16:40] publish a forecast and that's because we

[1:16:43] have a 19 person committee and you know

[1:16:45] you try to do it you try to do that on

[1:16:46] the at the board that's hard or the at

[1:16:48] the committee that's hard uh it's hard

[1:16:50] if you do it at the staff so it's you

[1:16:52] know it's been it works I think our

[1:16:54] communications are fine but looking at

[1:16:56] doing it in a different and better way

[1:16:58] is the most natural thing in the world

[1:17:06] thank you Um, Colobby Smith with the New

[1:17:08] York Times. If I could follow up on

[1:17:09] Mike's question about hikes, are we

[1:17:11] right to assume that the hawkish outcome

[1:17:13] for the Fed is still one in which the

[1:17:15] committee just extends the pause in rate

[1:17:18] cuts? Yeah.

[1:17:18] And to what extent is there a growing

[1:17:20] sense within the committee that monetary

[1:17:22] policy really isn't just restrictive at

[1:17:25] all right now? Um, the economy is

[1:17:27] holding up relatively well despite this

[1:17:29] major energy shock. The unemployment

[1:17:31] rate has ticked lower. inflation was

[1:17:33] moving sideways even before the war and

[1:17:36] is now moving higher. Um so so where is

[1:17:38] the committee at on that debate?

[1:17:39] Yeah, you know where we're at is we

[1:17:41] think our really we think our policy

[1:17:43] rate is in a good place. Um if we need

[1:17:46] to hike we will we will certainly signal

[1:17:47] that and we will and we will certainly

[1:17:49] do it and if we need to to cut then if

[1:17:52] it's appropriate to cut then we'll we'll

[1:17:53] signal the opposite. I think we because

[1:17:56] we feel like we're we're in a good place

[1:17:58] to move in either direction. Um,

[1:18:02] nobody's calling for a hike right now.

[1:18:05] Um, so it really is going to depend on

[1:18:08] how things how things evolve. Uh, and

[1:18:10] you know that that's really where it is

[1:18:12] and as I mentioned clo you know much

[1:18:14] closer question this cycle on changing

[1:18:17] the guidance but but ultimately we

[1:18:19] didn't.

[1:18:20] And as it relates to the war at what

[1:18:22] point do you think the risk to growth

[1:18:24] will be larger than the risk to

[1:18:26] inflation as this conflict drags on?

[1:18:30] you know, you just have to find that out

[1:18:32] empirically, you know, with given our um

[1:18:35] the fact that we're, you know, a big

[1:18:37] exporter of energy and that our economy

[1:18:40] is far less energy intensive, oil

[1:18:42] intensive than it was during the 70s.

[1:18:45] Um, you know, the the effects on the

[1:18:47] United States are really substantially

[1:18:49] less than those of Western Europe or or

[1:18:53] Asia. We're feeling much greater effects

[1:18:55] from from these things. the effects

[1:18:57] we're feeling in, you know, in the

[1:18:59] current situation currently and in in

[1:19:02] sort of what's priced in which is, you

[1:19:04] know, a relatively quick outcome. If if

[1:19:08] this goes on for much longer and prices

[1:19:09] go much higher, then we'll feel that

[1:19:11] much more. And of course, I'm talking

[1:19:14] about aggregate inflation numbers. We

[1:19:15] know, we're very well aware that people

[1:19:18] are experiencing higher gas prices all

[1:19:20] over the country now, and that hurts

[1:19:23] that and these are those those hikes may

[1:19:25] continue to happen.

[1:19:26] and other other things are going to

[1:19:28] start to reflect air airline fairs I

[1:19:29] mentioned and and other other products

[1:19:31] and services that are dependent upon

[1:19:34] petroleum and derivatives of of

[1:19:35] petroleum people are going to start to

[1:19:37] feel that

[1:19:39] Edward

[1:19:42] thank you thank you chair Edward

[1:19:43] Lawrence with uh Fox Business so I guess

[1:19:45] I'll just ask you directly on this

[1:19:47] markets don't see a rate cut at all this

[1:19:50] year is what they're predicting do you

[1:19:52] think that we are at the neutral rate

[1:19:54] why or why not,

[1:19:56] you know, the the neutral rate is a we

[1:19:58] cannot know it with uh with certainty. I

[1:20:01] think pretty close to the neutral rate.

[1:20:03] Yeah. I I always had it, you know,

[1:20:04] between 3 and 4%. We're a little north

[1:20:06] of 3 and a half. So, that's well in the

[1:20:09] range of what I would consider a

[1:20:10] reasonable reasonable, but at the higher

[1:20:12] end of the range of what I would

[1:20:13] consider reasonable neutral rate. Um,

[1:20:16] you know, I think you're the labor

[1:20:17] market is still probably cooling off

[1:20:20] just a little bit. Um, and I I I don't

[1:20:24] think there's a much of a case for any

[1:20:27] case really for the for uh policy

[1:20:30] looking, you know, meaningfully

[1:20:32] restrictive, maybe mildly restrictive or

[1:20:34] neutral, I would say.

[1:20:35] Um, and I want to follow up on some of

[1:20:37] the other questions about uh your future

[1:20:38] a little bit. The the first time we've

[1:20:40] seen four descents now since October of

[1:20:43] 1992, are you handing off a divided Fed?

[1:20:47] You know, the thing to remember is uh uh

[1:20:51] we have always had vigorous debates and

[1:20:54] and uh they're excellent debates. I have

[1:20:56] to say they're they've been really good.

[1:20:58] Uh and uh we're in an unusually

[1:21:01] difficult situation. So we we've really

[1:21:03] had four supply shocks. You can actually

[1:21:06] you can say more than four, but at a

[1:21:08] minimum we've we had the pandemic, we

[1:21:11] had the invasion of the of Ukraine, we

[1:21:14] had tariffs, and now we have of Iran and

[1:21:16] the oil um you know the oil spike. So

[1:21:20] those every every supply shock has the

[1:21:23] capability of right driving inflation up

[1:21:25] and unemployment up and and what do you

[1:21:28] do? You know, you're it's central bank

[1:21:30] has a really hard time knowing what to

[1:21:31] do. So the right thing to do is to try

[1:21:34] to balance the achievement of those two

[1:21:35] goals. And that's what our framework

[1:21:37] calls for us to do. But these are really

[1:21:39] tough, difficult judgments. You've got

[1:21:41] to have a forecast for each variable.

[1:21:43] You've got to think how long it's going

[1:21:45] to take to get back to target. You got

[1:21:47] to think how how restrictive or not

[1:21:49] policy. So it's only natural that you

[1:21:51] have a range of views on the committee.

[1:21:53] You know, people are going to see it

[1:21:54] different ways. They're going to have

[1:21:55] different risk tolerances and that kind

[1:21:56] of thing. I mean, if everybody agreed,

[1:21:58] that would be that would be surprising.

[1:22:01] Uh and I I think it's only it's partly a

[1:22:04] function of the extraordinarily

[1:22:06] challenging set of supply shocks that

[1:22:09] we've been dealing with now for five six

[1:22:11] years.

[1:22:17] Thank you so much, Chair Powell. Selena

[1:22:18] Wayne with ABC News. Are you confident

[1:22:20] that Kevin Worsh will stand up to

[1:22:22] political pressure from President Trump?

[1:22:25] So, he he testified very strongly to

[1:22:27] that effect in his hearing, and I and I

[1:22:29] I'll take him at his word.

[1:22:30] And when it comes to gas, right now it's

[1:22:32] over $4 a gallon. Inflation just hit a

[1:22:35] 2-year high. Should Americans expect to

[1:22:37] be paying higher gas prices for the rest

[1:22:40] of this year? And in your view, does

[1:22:42] that take a rate cut off of the table?

[1:22:44] And secondly, by staying on as uh Fed

[1:22:47] Governor, what message do you think

[1:22:49] you're sending to the president? I I

[1:22:51] don't know what gas prices are going to

[1:22:53] do for the rest of the year and um it

[1:22:56] will depend on how long the straight

[1:22:57] remains closed and how quick quickly it

[1:22:59] can be reopened and that kind of thing.

[1:23:00] But remember when gas prices go up um

[1:23:04] that's disposable income coming out of

[1:23:06] people's pockets. So they're going to

[1:23:07] spend less on other things. So there

[1:23:09] will be a hit to GDP. So it's a you know

[1:23:12] it's a it's a question whether spending

[1:23:15] you know goes down uh to offset the

[1:23:18] inflationary effects. So it's not the

[1:23:21] answer isn't obvious uh exanti whether

[1:23:24] you whether you should move your rate o

[1:23:27] over because of that we'll have to see

[1:23:29] how it evolves

[1:23:30] message

[1:23:32] by staying on

[1:23:33] I'll stand on what I said earlier

[1:23:37] Victoria

[1:23:41] hi Victoria Aguido with Politico um

[1:23:43] during your tenure fed independence has

[1:23:45] come under pressure in a lot of

[1:23:47] different ways and I was just wondering

[1:23:49] ing practically speaking, where do you

[1:23:51] see Fed independence as coming from? Is

[1:23:54] it the law? Is it political support from

[1:23:56] Congress? Is it the actions of the Fed?

[1:23:59] What what sustains Fed Fed independence?

[1:24:02] Well, it's, you know, it's it's to to a

[1:24:04] significant extent it is the law. And,

[1:24:06] you know, we've had to go to court to

[1:24:09] successfully so far to defend it. But

[1:24:12] you know the the law does create a

[1:24:15] setting in which the Fed can and is

[1:24:19] directed to uh make monetary policy

[1:24:22] without consideration of political

[1:24:23] factors. And so so part of it is law.

[1:24:27] But but it goes beyond that though.

[1:24:29] There's a set of customs. There's

[1:24:30] there's a boundary line between the Fed

[1:24:33] and the administration between the Fed

[1:24:35] and the Treasury Department. And we need

[1:24:37] to respect those, continue to respect

[1:24:38] those boundaries about what the Feds are

[1:24:41] responsible for and what the Treasury is

[1:24:42] responsible for and what the the rest of

[1:24:45] the administration's respons

[1:24:46] responsible. So, some some of it is

[1:24:47] legal. Um, in fact, it's all legal at

[1:24:50] the end of the day. But there it's it's

[1:24:51] more than just monetary policy. We, you

[1:24:53] know, we don't we don't want to use our

[1:24:56] tools to we haven't wanted to use our

[1:24:58] tools to achieve goals that are really

[1:25:01] clearly outside our mandate. Every

[1:25:02] administration looks at our tools and

[1:25:04] thinks that would be good to repurpose

[1:25:06] those to serve other purposes, but that

[1:25:09] gets drag that's dragging us into

[1:25:11] politics and into fiscal policy. So,

[1:25:13] we've resisted that.

[1:25:15] Well, and maybe another way of asking it

[1:25:17] too is do you think that Fed

[1:25:18] independence is as strong now as when

[1:25:20] you became chair? And if so,

[1:25:23] why stronger?

[1:25:24] Look, I think it's at risk. I mean, I

[1:25:26] think these these,

[1:25:28] you know, these legal assaults, if you

[1:25:31] will,

[1:25:31] as I mentioned, you know, we're the

[1:25:33] institution is being battered over these

[1:25:35] things. We're having to resort to, you

[1:25:37] know, the courts to to enforce our

[1:25:40] legal, you know, in not even it's not so

[1:25:43] much independence. It's it's really the

[1:25:45] ability to do monetary to make monetary

[1:25:48] policy without political considerations.

[1:25:50] That's what we're talking about. And uh

[1:25:53] we've had to do that and we've been

[1:25:55] successful. so far. But that's not over.

[1:25:57] None of that is concluded yet. And it's,

[1:25:59] you know, it's really important. It's

[1:26:00] not about it's not about people who work

[1:26:02] at the Fed or the institution. It's

[1:26:04] about the benefits of a central bank

[1:26:06] that makes decisions based on analysis

[1:26:10] and our best thinking. Uh rather than,

[1:26:14] you know, trying to help or hurt

[1:26:15] politicians. It's, you know, that

[1:26:17] there's there's a bright line between

[1:26:19] central banks who do one and do the

[1:26:21] other and successful countries have

[1:26:23] uniformly successful advanced economy

[1:26:26] countries have a really strong set of

[1:26:29] protections around their central bank

[1:26:30] just for that reason. So that's what

[1:26:32] it's all about. I you know I I think I

[1:26:35] am confident as I said in my remarks

[1:26:37] that the Fed will continue to make its

[1:26:39] decision based on analysis, rigorous

[1:26:41] analysis and not on political

[1:26:43] considerations. But we've had to fight

[1:26:45] for it. And I I' you know, I'd like to

[1:26:47] think that, you know, I'd like to think

[1:26:48] we can get out of that era and go back

[1:26:51] to respecting, you know, what the law

[1:26:53] says and what custom has been, which is

[1:26:55] to, you know, let the Fed do our thing.

[1:26:58] We're, you know, we're we're not we're

[1:26:59] it's a it's an institution full of human

[1:27:02] beings who work super hard to get things

[1:27:04] right for the benefit of the public.

[1:27:05] We're all human. Don't expect for

[1:27:07] perfection, but do expect us to make,

[1:27:10] you know, decisions without political

[1:27:11] considerations. Standing ovation,

[1:27:13] please.

[1:27:13] And the very best analysis we can bring.

[1:27:16] Good, dude. End it on that.

[1:27:18] Katarina.

[1:27:19] Damn, that was good.

[1:27:21] Katarina Sariva, Bloomberg News.

[1:27:23] Damn.

[1:27:23] Um, how would you characterize um what

[1:27:26] you've heard from your colleagues on

[1:27:28] your decision to stay? Um, do you have

[1:27:30] their support? And then have you heard

[1:27:32] concern from your colleagues um about

[1:27:36] continued legal attacks from um the

[1:27:38] executive branch? Is this something that

[1:27:41] others have uh you know talked to you

[1:27:43] about?

[1:27:43] So I think that

[1:27:46] um I I don't want to report on what my

[1:27:49] colleagues think. They can they can

[1:27:50] speak for themselves but you know yeah

[1:27:52] there are there widespread concerns that

[1:27:54] these things may continue. That's all

[1:27:56] that's all I'll say. And uh you know and

[1:27:58] that would be a problem. And um

[1:28:00] no Scott

[1:28:03] didn't mark it. Um and then I just also

[1:28:05] wanted to ask about um Governor Waller's

[1:28:07] speech on the reserve banks. um what you

[1:28:11] know do you have any thoughts on on

[1:28:13] centralizing some of those functions in

[1:28:15] the way he described and then um have

[1:28:18] you know do are you concerned that

[1:28:20] something like that could potentially be

[1:28:22] a slippery slope to um you know to

[1:28:25] consolidate reserve bank functions even

[1:28:27] more in such a way where you you know

[1:28:30] the central bank ultimately loses some

[1:28:32] of that important regional information.

[1:28:36] So

[1:28:37] we try to be good stewards of the

[1:28:39] public's money and efficient and Chris

[1:28:42] in particular Chris Waller is

[1:28:44] particularly passionate about that of

[1:28:46] course so are the reserve so are the

[1:28:47] presidents and you know it's a question

[1:28:50] of how do you accomplish it uh we we of

[1:28:53] course and and Chris said this in his

[1:28:55] speech we you know we want 12 strong

[1:28:58] independent central banks with their own

[1:28:59] staffs and their own monetary policy

[1:29:01] views and all that but you know there

[1:29:04] are things that are done in all 12 which

[1:29:05] could well be done at one much more

[1:29:07] efficiently and with cost savings. And

[1:29:08] so there's a back and forth going on on

[1:29:10] that, but everybody everybody's on the

[1:29:12] same page. The other thing he touched on

[1:29:14] was was uh the idea of removing Reserve

[1:29:18] Bank presidents from office over

[1:29:20] different views on monetary policy. And

[1:29:23] I would I would just agree with him so

[1:29:25] strongly that that would be the

[1:29:27] beginning of the end of of the Fed's

[1:29:29] ability to to make monetary policy

[1:29:32] independently if every administration

[1:29:33] could come in and do that. you're you're

[1:29:35] just another cabinet agency at that

[1:29:37] point. So that's not something that I

[1:29:39] would support. Chris said the same

[1:29:40] thing.

[1:29:41] Yeah.

[1:29:42] Christine,

[1:29:46] thanks Chair Pal. Christine Romans, NBC

[1:29:48] News. I want to ask about legacy when

[1:29:50] the history books are written. How do

[1:29:52] you think your stewardship at the Fed

[1:29:55] will be remembered for the past eight

[1:29:57] years?

[1:29:58] You know, I'm going to just say that uh

[1:30:01] that's for that's for someone else to

[1:30:02] say. I'll give you a mulligan on that

[1:30:04] half.

[1:30:05] All right. I'm gonna ask you about uh

[1:30:07] misbehaving inflation then. You talked

[1:30:10] about those four big shocks, supply

[1:30:11] shocks over the past 5 years and in

[1:30:14] inflation still misbehaving. What's your

[1:30:15] message to American families who feel

[1:30:17] like inflation has not been under

[1:30:19] control for them really since since the

[1:30:21] co reopening.

[1:30:22] Job isn't done.

[1:30:23] You know, we're we're committed to bring

[1:30:24] inflation back down to 2% and and

[1:30:28] sustainably. That's that's our goal and

[1:30:31] we will we'll stick at it until that

[1:30:32] happens. We keep getting these events

[1:30:34] keep happening which keep driving up

[1:30:36] costs and you know the best thing we can

[1:30:40] do is to use our tools to guide

[1:30:42] inflation back down to 2%. I think

[1:30:45] trying to get there really quickly could

[1:30:47] be very costly in terms of of uh of job

[1:30:50] loss and things like that but we try to

[1:30:53] get there over time in a way that does

[1:30:55] the least damage possible. And you know,

[1:30:56] our commitment to that is never ending

[1:30:59] and unshakable.

[1:31:00] How would you describe the economy

[1:31:02] outside of the misbehaving inflation? I

[1:31:04] mean, um, it's still awfully resilient

[1:31:07] given all of the blows.

[1:31:10] I don't know that you can be awfully

[1:31:11] resilient. So, it's actually quite

[1:31:13] resilient, I would say, cuz it's a

[1:31:14] positive thing if I can if I can have

[1:31:16] that amendment. Yeah. That the, you

[1:31:18] know, growth is really solid across our

[1:31:21] economy. Some of that is um that

[1:31:23] consumer spending is hanging in pretty

[1:31:25] well. The the most recent data are good

[1:31:28] and some of it is just the apparently

[1:31:30] insatiable demand for data centers all

[1:31:32] over the United States. So a lot of uh

[1:31:35] business investment going into building

[1:31:37] data centers and every reason to think

[1:31:38] that that continues. So you've got an

[1:31:40] economy that's growing at 2% or better.

[1:31:43] PDFP which is private domestic final

[1:31:45] purchases that which is really a better

[1:31:48] signal of of uh of a momentum in the

[1:31:50] economy is actually higher than that. So

[1:31:52] that's you know that's a positive thing.

[1:31:54] The if you look at the unemployment rate

[1:31:57] it's 4.3%. So that's a low rate that's

[1:32:00] pretty close to mainstream estimates of

[1:32:02] the natural rate. We've been there for a

[1:32:03] long time. So, it's it's it doesn't feel

[1:32:06] like a good labor market to some who who

[1:32:08] don't have jobs because quits are really

[1:32:10] low, hires are really low, and there's

[1:32:13] effectively no new net job uh creation.

[1:32:16] So, that's a that's you know, in a

[1:32:19] sense, the labor market is in balance,

[1:32:21] but it's an unusual and uncomfortable

[1:32:24] kind of a balance where people who don't

[1:32:26] have jobs will have a hard time breaking

[1:32:27] in unless somebody quits their job. Y

[1:32:30] So, um so that's pretty good. You know,

[1:32:32] inflation is the thing we need to work

[1:32:33] on, and it's partly tariffs, which we

[1:32:36] think we think that that inflation

[1:32:38] should subside over the course of this

[1:32:39] year because it's it's kind of a

[1:32:41] one-time increase. It shouldn't be

[1:32:43] repeated, and that should start

[1:32:44] happening pretty soon. The energy in

[1:32:47] inflation that we're getting should go

[1:32:48] through fairly quickly. Uh, and we'll

[1:32:52] we'll just have to see how that works

[1:32:53] out. In the meantime, you know, we think

[1:32:55] our policy stance is in a good place for

[1:32:56] us to hold and and wait developments.

[1:33:00] Jennifer

[1:33:03] Thank you, Chair Pal. Jennifer

[1:33:04] Shawnberger with Yahoo Finance. At the

[1:33:06] risk of beating the dead horse here,

[1:33:08] clearly three members objected to

[1:33:10] keeping that easing bias in the

[1:33:12] statement. And you said that the

[1:33:14] majority still didn't need

[1:33:17] still didn't need to uh move to new

[1:33:19] language at this point. So does the

[1:33:22] majority of the committee still have a

[1:33:24] bias towards cuts at this point or has

[1:33:27] the bias on the committee shifted away

[1:33:30] from cuts towards holding or hikes if

[1:33:32] that was needed?

[1:33:33] I so I think that you know the the

[1:33:35] center is moving

[1:33:38] toward a more neutral place and that's

[1:33:41] sort of what markets are saying too. I

[1:33:43] just think, you know, uh there's a lot

[1:33:46] of signaling going on when you change

[1:33:48] guidance like that. And so we we just I

[1:33:51] guess the major a majority of us didn't

[1:33:54] feel like we needed to send a signal on

[1:33:56] that right now. Uh and but maybe it'll

[1:33:59] come to that. And and the reason is

[1:34:00] because, you know, we're kind of waiting

[1:34:02] to see what happens with with events in

[1:34:05] the Middle East and what are the

[1:34:06] implications of those events for the US

[1:34:09] economy. So it was just a there's a

[1:34:11] group who feels like we don't need to be

[1:34:12] in a hurry to do that. We we get it and

[1:34:14] of course we will move to a hiking bias

[1:34:17] if we want to hike and we'll move to a

[1:34:19] new a neutral bias before that. But

[1:34:21] there was a difference over whether to

[1:34:22] do it at this meeting at a at a meeting

[1:34:24] at which all but one of us agreed that

[1:34:26] that the that the rate decision was

[1:34:28] correct which was not to move.

[1:34:30] And you just said moments ago that you

[1:34:32] believe Fed independence is at risk. Is

[1:34:35] it safe to say that you want to stay on

[1:34:37] as a governor to serve as a check and

[1:34:39] balance on that?

[1:34:42] I I want to stay until I I will stay

[1:34:44] until it's I feel it's appropriate for

[1:34:46] me to leave and and yes, that is that is

[1:34:48] really what is driving this. Uh

[1:34:49] that's fair.

[1:34:50] I'm not uh I'm not looking to be, you

[1:34:54] know, a high-profile uh dissident or

[1:34:57] anything like that. I I'm I'm more

[1:34:59] looking at the other aspects of this and

[1:35:02] wanting to see that things have calmed

[1:35:03] down and and we're returning to a

[1:35:06] traditional model of working with the

[1:35:09] people that you have and bringing them

[1:35:11] to consensus and respecting that

[1:35:13] consensus. That's what that's what I'm

[1:35:15] I'm hoping to see.

[1:35:19] Matt Eaggan,

[1:35:23] thanks Towel. Matt Eaggan with CNN. Um,

[1:35:25] you've made many tough decisions in your

[1:35:28] time at the Fed and as your time as

[1:35:31] chair comes to a close and you think

[1:35:33] about your tenure and perhaps your

[1:35:35] legacy, are there any decisions that

[1:35:37] stand out as ones that you're

[1:35:38] particularly proud of? And are there any

[1:35:41] that with the benefit of hindsight you

[1:35:43] would take a mulligan on?

[1:35:46] Yeah, I it's hard I wouldn't want to

[1:35:48] signal single out individual things at

[1:35:50] this point. You know, I'll just say uh

[1:35:53] you know, we all of us together have

[1:35:56] consistently tried to do what we think

[1:35:59] is best for the American people based on

[1:36:01] our tools and our objectives that that

[1:36:03] Congress has given us. It's been very

[1:36:05] challenging because we've been in a

[1:36:07] situation of supply shock, supply shocks

[1:36:10] really for 6 years. And that's just a

[1:36:14] very different situation than for a very

[1:36:16] long time what the Fed and other central

[1:36:19] banks were doing all the time was demand

[1:36:21] management and you know and there was

[1:36:24] always the inflation mandate but

[1:36:25] inflation was low for 25 years. So this

[1:36:28] is a very different world and a much

[1:36:31] more challenging one where you have to

[1:36:32] balance the two objectives and by the

[1:36:34] way central banks that have a an

[1:36:36] inflation mandate have to do exactly the

[1:36:38] same thing because they're balancing

[1:36:39] economic activity. So that's been

[1:36:41] challenging and we've, you know, we've

[1:36:43] tried to do our very best through these

[1:36:45] really challenging uh times and I'm

[1:36:47] really proud of of uh the work that I've

[1:36:50] done that my that my colleagues and I

[1:36:52] have done during these uh these years.

[1:36:55] Now to follow up on some of the the

[1:36:56] discussion around Fed independence, can

[1:36:59] you explain to the public why this

[1:37:02] notion of Fed independence, which might

[1:37:03] sound kind of wonky to some, is so

[1:37:06] critical? I mean, what are the

[1:37:07] consequences if either the Supreme Court

[1:37:09] rules against such unanchored inflation

[1:37:12] expectations blah blah blah blah blah

[1:37:13] make decisions more

[1:37:15] end it and give them a standing ovation.

[1:37:18] So every major advanced economy in the

[1:37:22] world has made the same decision the

[1:37:24] United States has made and that is that

[1:37:27] they want to take the making of monetary

[1:37:29] policy the setting of interest rates to

[1:37:31] support the economy to achieve maximum

[1:37:33] employment and price stability. They

[1:37:35] want to take that out of the direct

[1:37:37] control of elected politicians and the

[1:37:40] reason is elected politicians are always

[1:37:42] running for election and they'll always

[1:37:44] want low rates and that will re lead to

[1:37:46] inflation over time. So after you know

[1:37:49] literally centuries of experience with

[1:37:51] that the whole world moved to the

[1:37:53] different model and it's it's worked

[1:37:54] great. I mean this is this is the era in

[1:37:56] which inflation was under control for 40

[1:37:59] years. Then we had the pandemic

[1:38:00] inflation everywhere on in the world and

[1:38:02] now we have inflation that had gone

[1:38:04] pretty much all the way back to target

[1:38:06] really close to all the way back to

[1:38:07] target and now is being buffeted by the

[1:38:10] energy shock in the US buffeted by the

[1:38:12] by the tariff shock as well. So but what

[1:38:14] I would say to the general public is

[1:38:16] that's that's the backstory is that um

[1:38:19] stop the count.

[1:38:20] Don't think about an institution being

[1:38:22] independent. Think about it this way

[1:38:23] that you want people to make monetary

[1:38:26] policy and set interest rates to benefit

[1:38:28] the general public and to try to achieve

[1:38:30] economic goals which are maximum

[1:38:32] employment and price stability and focus

[1:38:34] only on that and ignore political

[1:38:37] considerations completely ignore them.

[1:38:39] It's this isn't bipartisan. This is

[1:38:41] nonpartisan. So we we we want to just we

[1:38:44] just work directly for the American

[1:38:46] people doing these things. We don't

[1:38:48] think, "Oh, this I want to do this

[1:38:49] because the president says it's a good

[1:38:51] idea or because there's an election

[1:38:52] coming up and I want to I want to speed

[1:38:54] up or slow down the economy." I mean,

[1:38:57] that think about that. If that's if that

[1:38:59] that's what we were doing, we'd have no

[1:39:01] credibility. Markets would lose faith in

[1:39:03] us and our ability to control inflation

[1:39:06] and and and have any respect would be,

[1:39:09] you know, would be gone. And let me say,

[1:39:10] whatever people say, the markets believe

[1:39:13] in that we will produce 2% inflation. If

[1:39:15] you look at longer run expectations,

[1:39:17] markets believe that they there's

[1:39:19] there's no sense in which our

[1:39:21] credibility in the markets has weakened.

[1:39:23] It's just not the case. It's it's people

[1:39:25] do get it that this is our commitment

[1:39:27] and that we will achieve it and it's

[1:39:29] priced in. If you disagree with that,

[1:39:31] then you can go ahead and bet against

[1:39:32] the markets, but the markets are pricing

[1:39:34] in Fed credibility.

[1:39:36] Yeah.

[1:39:38] Okay, we'll go to Richard for the last

[1:39:39] question.

[1:39:40] Last question. Thank you.

[1:39:42] Thank you, Chair Pal. uh Richard

[1:39:44] Escobido with CBS News. Uh we've talked

[1:39:46] a lot about gasoline prices and and even

[1:39:48] you mentioned airline ticket prices,

[1:39:50] both of which are up dramatically

[1:39:51] because of the war in Iran. And so I

[1:39:54] wonder, are you seeing that weigh down

[1:39:56] consumer spending in other parts of the

[1:39:58] economy? Um and if so, how worried are