00:00Why was it a mistake not to put a dot on that plot?
00:03Right, well, I think the statement ended with a very forceful,
00:06this committee will deliver price stability,
00:08which leads to a natural question of, well, how are you going to do that?
00:12Right, like, what do you, how are you going to deliver?
00:15And the summary of economic projections, it is not perfect, it's often misunderstood,
00:18but that is actually the exercise of the dot plot.
00:23It's actually, each individual is like the FOMC.
00:26What is the appropriate path for federal funds rate?
00:30What's the right monetary policy to get us to the dual mandate?
00:34That price stability, you know, 2% is where all of those forecasts end in 2028.
00:39That's because of they're working their way towards price stability
00:42and they adjust their federal funds rate to get there.
00:44So they're like putting together plans individually.
00:47And Kevin Worscht didn't participate in that exercise
00:49and he didn't flesh out in the press conference his views of what a plan could be
00:54of how to get to that price stability.
00:57And this is partly by design, right?
00:58I mean, he talked about how he wanted the market to be one of the key metrics that they do
01:03look at
01:04and that the market, he wants to have clarity of focus on the data
01:08without trying to interpret how the Fed would look at the data
01:11and then respond to the Fed's response to the data.
01:13I mean, what do you make of that argument?
01:16I think it's going to be a tough sell.
01:19And honestly, I can, you know, set aside, he doesn't want to talk about plans.
01:23He doesn't want to talk about the future.
01:24Okay, that's a debate to have about communication.
01:27But what was really striking is he didn't want to talk about the decision they made this week.
01:32I mean, they say they want price stability.
01:34They voted unanimously to hold rates steady.
01:37How is that in service of price stability?
01:39Are you saying you think they should have hiked this meeting?
01:42No, I think they should have explained why they chose to hold rates steady.
01:48I agree with that decision.
01:50But it is, it's like totally pointless that I agree with it.
01:52I want to hear what the Fed chair thinks about it, what the committee thinks about it.
01:57Why was that the right decision?
01:58We know from the Summary of Economic Projections that many of them think it's going to be appropriate
02:02to raise rates later.
02:04Many of them don't think it will be.
02:05Like, tell me about why you decided to do what you did today.
02:09It's communications also about accountability.
02:13Like, understanding who these people are that are making these big decisions.
02:17They don't have a crystal ball, but I really do expect them to explain what they're doing
02:21right now and show their work.
02:22Is it potentially that Kevin Warsh views it as a slippery slope to then be an individual
02:26that's up there on the podium giving forward guidance, which he doesn't agree with?
02:31Again, I don't, you know, don't tell me about the future, but I feel like there's some hiding
02:37behind the jargon.
02:38And I will say, first press conference, right?
02:40Like this, you know, unevenness out of the gate, totally understandable.
02:44But I do think there's room for adjustment.
02:47And if you just want to talk about the decision that was made today, fine.
02:52But do talk about that.
02:53And yes, I think it's important, you know, the slippery slope, okay, fine.
02:57But the service of accountability is important.
03:00And we do need to, I think, have some insights onto the discussions that they're having and
03:05how they're weighing the data and what they're thinking about.
03:07Because honestly, right now, monetary policy is tough, right?
03:11So we should have some insights into the debate that they're having about those policies.
03:16So we should have some insights into the debate that they're having about those policies.
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