Hammack adds:
- Now is a challenging time for monetary policy making
- it will take a couple of years to get back to 2% inflation target
- the Fed bigger miss is on the inflation side relative to job mandate.
- Inflation overshoot goes beyond tariff pressure.
- A little bit nervous about current policy given inflation.
- I would not want to cut rates into accommodative territory.
- The economy is pretty robust and healthy right now
- is closely watching inflation expectations data
- AI boom could mirror what happened with Internet build out.
- AI is a structural economic change is not well-suited to monetary policy changes.
- Fed has some excellent job managing federal funds rate, but it's a small market.
- It's good for the Fed to debate what its interest rate target should be.
- Changing Fed rate target likely would not have broader policy impact
- Regularly hears about bifurcated economy, lower incomes challenged.
- Consumption is driving by high income American
- Mindful that the job market has cooled by recent data suggests it is still health
It seems the memo is to tilt toward inflation over employment amongst most of the Fed officials. Is the nuance tilt, a way to slow down "markets" (i.e. stocks) without saying so.
The K economy threatens a large swatch of the population who are more impacted by inflation. The "have-nots" don't care about stocks they care about prices. The "haves" meanwhile are not concerned about anything - until they do (like a correction in stocks).
NASDAQ index is down -1.75% while the S&P index is down -1.07%.
