- Fed is not trying to create a recession
- Economic data suggests Fed not as restrictive as it appears
- We are allowing the data to drive Fed decisions
- Fed has made a lot of progress on inflation
- Data will tell the Fed if more hikes are needed
- We want to see workers get better wages
- Fed is watching strikes for economic impact
Kashkari laid out his position yesterday and it was surprisingly hawkish, adding to the pain markets. I think there needs to be a fresh conversation about the distortions of QE and the stock of Fed holdings. There's a fair argument that's held down the long end and is what inverted the yield curve. In a 'normal' scenario, the higher stock of long-dated bonds in the market would have pushed up rates and restrained the economy more.
