00:02We've talked a lot about the silent descents, the quiet descents that happened at that meeting.
00:06What are we likely to learn from the kind of panoply of speakers who are going to be giving remarks and interviews over the course of the week?
00:12Yeah, I think the one thing that stood out in the December FOMC meeting is just how divergent views are within the committee.
00:20I mean, if you just look at even the dot plot, for example, in 2026, seven participants felt that it's appropriate to hold rates steady.
00:30Where they are now.
00:31So I think going into this week and also just, you know, beyond this week, we want to get a sense of who's thinking how.
00:38For example, we did hear from Goolsby that his dissent was to some part tied to the fact that he didn't have enough data to go by.
00:45Right. And so that gives you some insight into, I guess, what he's looking for.
00:50And, you know, we're likely to get similar insights from others.
00:53And I'm sure like a lot of other Fed watchers, we'll be trying to, you know, we're trying to place them on the on the DoveHawk lineup.
00:59Yeah.
01:00To see exactly where their minds are at and to go to give us a sense, really, of what the reaction function is for each of these participants.
01:07Over the weekend, San Francisco Fed President Mary Daly put out a blog post and she was talking about why she supported cutting rates the last meeting.
01:14And she talked about how, yes, it was a very difficult decision because there is this dual dual mandate that's very much in conflict.
01:20She was talking about inflation. Yes, I always got to talk about it and how it has been really punitive for these families.
01:25But she said how you get down to two percent matters, because if you get there too quickly, you break the labor market and then you've got families grappling with both above average inflation and potential job losses.
01:36Do you think that there is this theory right now presiding over the Fed to run the economy a bit hot, especially at a time of technological transition with artificial intelligence proposing some existential questions around the labor market in order to avoid some sort of labor market scarring at the expense of inflation not getting down to two percent any time in the near future?
01:56Well, I. OK, well, this is what I think stood out to me in the December presser.
02:01There seems to be this view in the Fed that inflation is really not a problem right now.
02:09In fact, Chair Powell's own comments on inflation is he's quite sanguine about it.
02:12I think in some part of the presser, he did think that inflation, you strip it out of all the tariff effects, is somewhere in the low twos.
02:19Then he mentioned something about productivity, also likely to support the economy.
02:25So if you sort of put all those views together, I think there is this this view out there in among the Fed participants that inflation is perhaps not a problem to be concerned about.
02:34And what they need to be concerned about right now is the labor market.
02:38That's perhaps what, you know, Mary Daly is also subscribing to in some sense.
02:41My own take is I think it's a little too premature to to think that inflation is going to take care of itself.
02:48You know, we at Barclays have been saying for a while that we are yet to see the full effects of tariffs on the inflation data.
02:55And sure, while it may be a one time price shock, I think it's a little too early to declare victory on inflation yet.
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