00:00Diane, it sounds like you, again, doesn't sound like you say, that you're worried about quite a few things.
00:05And I wonder, to what degree can some of those things be solved by a rate hike?
00:09It's a market that completely backed out of pricing for this month to get a rate hike.
00:13We're still pricing one in by your end. Is that necessary from this Federal Reserve?
00:18I actually think two rate hikes are necessary by the Federal Reserve.
00:22The structural factors, it's unfortunate that we've got a lot of supply shocks that are pushing up inflation.
00:28We've had repeated ones. In addition to demand over the last five years, you pick a day, you can have
00:33a different set of factors.
00:34But all of them lead to the same path, and that's a persistent period of elevated inflation.
00:40And we know post-pandemic, a period of uncertainty, which I argue today has gone from episodic in the past,
00:47where you'd have a storm, the damage passed,
00:49we all did the repairs and it was over and you can move forward, to being endemic uncertainty,
00:53where you're constantly weighing on big investment decisions that's causing a hesitation out there.
01:00All of that is adding to the inflation environment.
01:04We know an inflation environment where you have a lot of supply shocks with high levels of uncertainty gives you
01:09more persistent bouts of inflation.
01:11That's what the post-pandemic period and the research has now told us.
01:16That's a job, sadly, only the Federal Reserve can fix.
01:20And inflation is the most regressive of all taxes out there.
01:25It hits those who can afford at least the hardest, and that's why the Fed has to raise rates.
01:30It is hard because those people who are affected the least by inflation are also affected the least by higher
01:37interest rates.
01:37So, let's go ahead.
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