00:00The world's oil supply has a choke point.
00:02Iran just grabbed it by the throat.
00:04And the guy now in charge of your mortgage rate has only been on the job for three days.
00:08So how did we get here and what does it mean for your wallet?
00:11Here's what's happening.
00:12The Fed just dropped its May inflation forecast and analysts are sweating.
00:16Think of interest rates like a thermostat.
00:18Too cold? Cut the rates and heat the economy up.
00:21Too hot? Raise them and cool it down.
00:24Right now the temperature is climbing and nobody agrees on where to set the thermostat.
00:28Jerome Powell had spent his final months as Fed chair flagging that tariffs could overheat prices.
00:33A view that put him directly at odds with the president who had been pushing for rate cuts.
00:38Then the U.S. and Israel struck Iran.
00:40Iran's counter move was to slam the door on the Strait of Hormuz creating the largest energy disruption in recorded
00:46history.
00:47Gas prices jumped at their fastest pace in 30 years.
00:51And energy costs don't just hit your tank, they bleed into food, shipping, and pretty much everything else.
00:56The fever started slowly.
00:57Inflation was at 2.4% in January, then 3.3% in March, 3.8% in April, and
01:04now the Cleveland Fed's May forecast is at 4.18%.
01:08Enter Kevin Warsh, Trump's newly appointed Fed chair, confirmed three days ago, who hasn't chaired a single meeting yet.
01:15He's inheriting a house with a thermostat that nobody agrees on how to set.
01:18He's also inheriting a stock market that has only ever been this expensive once before.
01:23Right before the dot-com bubble burst.
01:25Critics argue this was the worst possible time for a chair swap, that switching captains in the middle of a
01:30storm doesn't fix the weather, it just adds confusion.
01:33Supporters say the handoff was necessary, that Powell's fight with the White House had become a distraction, and a fresh
01:38set of eyes is exactly what a divided Fed needs right now.
01:41But what do you think?
01:42Was this the right time for a leadership change?
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