Latest / The Paul Barron Crypto Show / Fed Meeting vs Crypto📈Jerome Powell - Recession Fears Ignite🔥

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Fed Meeting vs Crypto📈Jerome Powell - Recession Fears Ignite🔥 · The Paul Barron Crypto Show

• 0:07
  Speaker 1: All right, so welcome into the live stream.
• 0:09
  Speaker 2: Today.
• 0:09
  Speaker 1: We're gonna be doing the FOMC discussion with Shairpal. You
• 0:13
  Speaker 1: guys don't want to miss. It's gonna be a great
• 0:14
  Speaker 1: rundown for you. My name is Paul Barrel. Welcome back
• 0:16
  Speaker 1: into tech Path. And if you guys are brand new
• 0:19
  Speaker 1: to the channel. First of all, there's one thing that
• 0:22
  Speaker 1: we do on these live shows. Occasionally we're starting to
• 0:26
  Speaker 1: roll these out a little bit more efficient, along with
• 0:28
  Speaker 1: the FOMC, but occasionally with other big breaking news. So
• 0:31
  Speaker 1: make sure and subscribe right now and hit that little
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  Speaker 1: live stream just like this. So if you ran across
• 0:38
  Speaker 1: this by accident on live this way, it'll notify you.
• 0:42
  Speaker 1: So very easy stuff. Big news in the market today,
• 0:46
  Speaker 1: and when you look at what's happening in the market
• 0:49
  Speaker 1: along with what's happening on the macro side of things,
• 0:53
  Speaker 1: we may be at a point where the market could
• 0:55
  Speaker 1: be at its bottom. Here is an ex X post
• 0:59
  Speaker 1: coming in from Stewart ALROADI and this of course is
• 1:01
  Speaker 1: talking about ripples moving forward now stronger than ever, landmark
• 1:05
  Speaker 1: case at a president. This is in reference to the
• 1:07
  Speaker 1: Ripple and the XRP case, the SEC is dropping its appeal.
• 1:12
  Speaker 1: This is huge news because it does set the stage
• 1:16
  Speaker 1: for not only XRP and Ripple to move forward, but
• 1:20
  Speaker 1: I think this starts to move into a variety of
• 1:23
  Speaker 1: all sorts of companies that have been waiting for this
• 1:27
  Speaker 1: last shoot to drop, and it has dropped now, and
• 1:30
  Speaker 1: I think this is going to be a step in
• 1:31
  Speaker 1: the right direction. Mister Powell, of course Scrimma be coming
• 1:35
  Speaker 1: on today, will air that stick around for that. We
• 1:39
  Speaker 1: air it just so you guys, if you've never experienced
• 1:41
  Speaker 1: one of these live streams that we do with the FOMC,
• 1:43
  Speaker 1: is what we're waiting for with share Powell is his response.
• 1:48
  Speaker 1: Now we know that there is no rate cut today,
• 1:51
  Speaker 1: that of course is already out, they just announced it.
• 1:54
  Speaker 1: No rate cut. The anticipation is really looking toward the
• 1:57
  Speaker 1: May timeline, which is the next FOMC, and we'll show
• 1:59
  Speaker 1: you some on polymarket to what that might look like.
• 2:03
  Speaker 1: But the update is what everybody's expecting and that's coming after.
• 2:07
  Speaker 1: So now we're at a point of where there's no
• 2:10
  Speaker 1: rate cut and the likelihood is whether or not they
• 2:14
  Speaker 1: look at restructuring a QT or a QE environment for
• 2:20
  Speaker 1: the rest of twenty twenty five. So I don't think
• 2:22
  Speaker 1: a tightening is in order. The pause for another cycle
• 2:26
  Speaker 1: could be a little bit bearish, but I anticipate we
• 2:29
  Speaker 1: could see a factor going forward that could be a QE.
• 2:33
  Speaker 1: And when we talk about what this means, it really
• 2:37
  Speaker 1: boils down to a couple of things, either one an
• 2:40
  Speaker 1: early rate cut or two multiple rate cuts throughout the
• 2:45
  Speaker 1: year that we've heard analysts this week talk about as
• 2:47
  Speaker 1: many as three. Some people believe that it's most likely
• 2:51
  Speaker 1: going to be two rate cuts, and then there are
• 2:53
  Speaker 1: analysts out there that believe that we may not get
• 2:55
  Speaker 1: a rate cut. And if you look at the situation
• 2:59
  Speaker 1: from a macro side of things, and I think a
• 3:01
  Speaker 1: lot of people have to compare that that is a
• 3:04
  Speaker 1: big factor going forward because obviously that has a big
• 3:08
  Speaker 1: impact on bitcoin recovering to ninety k if we see
• 3:11
  Speaker 1: some easing playing into this. Now, the biggest bad word
• 3:15
  Speaker 1: of the day will be tariffs, and the word April second,
• 3:19
  Speaker 1: because that is the critical date in which the administration
• 3:24
  Speaker 1: has implemented a reciprocal tariff. Now, what this simply means
• 3:28
  Speaker 1: is they're going to implement tariffs are the same on
• 3:31
  Speaker 1: countries that they implement upon us. That's going to happen
• 3:34
  Speaker 1: on April second, unless Trump and the White House back
• 3:37
  Speaker 1: away from that. Right now, the indicator is that Trump
• 3:39
  Speaker 1: is not planning to back away from that. How will
• 3:42
  Speaker 1: this affect the SEC is the real question. I think
• 3:44
  Speaker 1: that is what everybody's looking for. There are a couple
• 3:48
  Speaker 1: of things that we'll be looking at right now, and
• 3:52
  Speaker 1: that of course, this is not a major bullish development,
• 3:54
  Speaker 1: but you know, some fine tuning, they think that bitcoin
• 3:57
  Speaker 1: will be in a broader consolidation range. We could trade
• 4:00
  Speaker 1: back toward ninety k and we have seen some activity
• 4:03
  Speaker 1: on bitcoin even right here before chair Pal goes on,
• 4:07
  Speaker 1: we actually saw a nice little spike and then a
• 4:10
  Speaker 1: retrace a little bit. But pointing as we're up around
• 4:12
  Speaker 1: eighty four as we speak and record today, let's take
• 4:17
  Speaker 1: a look at the fear and greed coming in right
• 4:19
  Speaker 1: now at twenty three. And you'll notice over here, if
• 4:22
  Speaker 1: I can zoom in on that for you guys, that
• 4:25
  Speaker 1: chart has been coming out of that dip right there.
• 4:28
  Speaker 1: Let me zoom up a little bit, because we had
• 4:30
  Speaker 1: hit that fifteen point at a bitcoin price at around
• 4:34
  Speaker 1: seventy eight k, which is and has been the low
• 4:38
  Speaker 1: right now and definitely, but this nice little movement back
• 4:41
  Speaker 1: into where we are currently on twenty three or twenty
• 4:45
  Speaker 1: five yesterday, holding it about bitcoin volume at twenty four
• 4:48
  Speaker 1: billion and of course price at around eighty four k,
• 4:51
  Speaker 1: So not bad for the fear and greed. And if
• 4:55
  Speaker 1: you look at some other things within the charts, you
• 4:58
  Speaker 1: have to look at this one right here, because this
• 5:00
  Speaker 1: is a stock market that is also come up a
• 5:04
  Speaker 1: little bit because it had extreme, deep extreme fear a
• 5:08
  Speaker 1: little bit earlier last week. Obviously, we've seen a lot
• 5:11
  Speaker 1: come off the stock market over the last two weeks,
• 5:15
  Speaker 1: and I think now maybe there is a reprieve. Now,
• 5:17
  Speaker 1: if you've seen some of the clips we've played with
• 5:20
  Speaker 1: Tom Lee, he is I think the permeable and he
• 5:25
  Speaker 1: still thinks that this is the bottom, especially for securities.
• 5:29
  Speaker 1: So I don't know, what do you guys think. Do
• 5:31
  Speaker 1: you think this is the bottom for the stock market
• 5:33
  Speaker 1: where we see some adjustment here or people still going
• 5:35
  Speaker 1: into gold because that's where a lot of this cash
• 5:39
  Speaker 1: is flying, other than into M two, which is just
• 5:41
  Speaker 1: cash and just investments in general. So I think this
• 5:46
  Speaker 1: is a good thing to be watching, right now in
• 5:49
  Speaker 1: terms of the money supply into the other thing I
• 5:52
  Speaker 1: want you guys to do. If you're not visiting our website,
• 5:55
  Speaker 1: jump over to PBN. You guys can visit us over there,
• 5:57
  Speaker 1: and there is some thing that you can do is
• 6:00
  Speaker 1: join us on telegram. This is a great place to
• 6:02
  Speaker 1: actually communicate with me. I do it. Live in there
• 6:05
  Speaker 1: almost every day. I'm commenting or dropping stuff in there.
• 6:08
  Speaker 1: I'm in there very early in the mornings, always kind
• 6:11
  Speaker 1: of getting some feedback from you guys. I always love it.
• 6:13
  Speaker 1: Use this link on our website or the link we
• 6:16
  Speaker 1: leave down in the YouTube description. Because there are scammers
• 6:21
  Speaker 1: out there. There are people out there that fake our
• 6:23
  Speaker 1: channel and try to do some nefarious things out there.
• 6:25
  Speaker 1: So we only have one Telegram channel, so don't believe
• 6:28
  Speaker 1: there are others. We are the original and it's easy
• 6:32
  Speaker 1: to find. Let's take a look at what's going to
• 6:35
  Speaker 1: be said today, Chair Palell of course is this. I
• 6:39
  Speaker 1: love polymarket because they have some fun with this. But
• 6:42
  Speaker 1: you know, people are betting on anything. Tariff's is the
• 6:45
  Speaker 1: one thing I'm watching right now. If you look at
• 6:47
  Speaker 1: tariff and what the potential is, if you kind of
• 6:50
  Speaker 1: look at the graph here every kind of very high.
• 6:53
  Speaker 1: Then it dips a little, but you can kind of
• 6:55
  Speaker 1: see this is right now on high alert in terms
• 7:00
  Speaker 1: of how Powell is going to respond. Now, many people
• 7:02
  Speaker 1: believe that what the Trump administration is doing is trying
• 7:07
  Speaker 1: to structure a controlled market fall. And that's the thing
• 7:11
  Speaker 1: that many believe that this is designed to put a
• 7:15
  Speaker 1: little pressure on pal. If he puts enough pressure on
• 7:18
  Speaker 1: Pale and we get into a constricted growth, meaning lower inflation,
• 7:23
  Speaker 1: then the possibility of QE comes back and we could
• 7:27
  Speaker 1: see a boom coming into the market maybe at the
• 7:29
  Speaker 1: right time. Timing is everything right now? Raycut expectations are
• 7:34
  Speaker 1: dropping again. This is heading into the week. This is predictions.
• 7:38
  Speaker 1: They saw a base case of three interest straight cuts.
• 7:40
  Speaker 1: This is what everybody's watching for right now. Is that
• 7:42
  Speaker 1: portion right there on whether or not we get three
• 7:45
  Speaker 1: interest cuts over the year. But the base case is
• 7:49
  Speaker 1: falling sharply, so medium forecasts right now at about two
• 7:51
  Speaker 1: point six, So in average, raycuts are coming down slightly.
• 7:56
  Speaker 1: If you kind of look at that chart right there,
• 7:58
  Speaker 1: you can kind of see where I'm hovering, my mouse
• 8:01
  Speaker 1: dip is pulling off. Now what does that mean? Do
• 8:04
  Speaker 1: people understand that maybe inflation has started to edge back
• 8:08
  Speaker 1: level set again because after a little bit, let's go
• 8:11
  Speaker 1: to the six month you can kind of see that
• 8:13
  Speaker 1: trend down and then we bottomed out right here on
• 8:17
  Speaker 1: trueflation at about one point three, and then we had
• 8:20
  Speaker 1: that little lip and then boom back up here to
• 8:23
  Speaker 1: almost one point six. So not that that is a
• 8:25
  Speaker 1: great we're holding at one seven two right now, Not
• 8:27
  Speaker 1: that that is a great increase, but it is something
• 8:30
  Speaker 1: that right now, one tenth of a percent is an
• 8:34
  Speaker 1: important move right now, not only to the FED, but also,
• 8:37
  Speaker 1: I think in general, to the economy, because remember, you're
• 8:40
  Speaker 1: looking at two things right now that can slow the economy.
• 8:43
  Speaker 1: One is going to be jobs, and that will come
• 8:46
  Speaker 1: from businesses just not hiring as fast or as much.
• 8:50
  Speaker 1: And the other is the continued rising prices, which the
• 8:53
  Speaker 1: tariffs do effect. And I used to be a little
• 8:57
  Speaker 1: bit on the side of these terriffs may not hurt
• 8:59
  Speaker 1: any thing. Talking with a lot of business leaders in
• 9:04
  Speaker 1: a couple other industries over this past week, I've seen
• 9:09
  Speaker 1: real impact on their businesses. They're showing me things that
• 9:12
  Speaker 1: I didn't realize was happening. There are some real issues
• 9:16
  Speaker 1: that are going to be coming in on this, and
• 9:17
  Speaker 1: I think that finally, maybe corporate America is starting to
• 9:21
  Speaker 1: say ouch, and if they say ouch loud enough, maybe
• 9:25
  Speaker 1: Trump will listen and we'll see a little bit of
• 9:27
  Speaker 1: pull off. If that is not necessarily the case, well,
• 9:31
  Speaker 1: the next thing that's going to happen is a layoff
• 9:34
  Speaker 1: alert in the United States, and that will be true
• 9:37
  Speaker 1: if we continue to see this kind of decline. Right here,
• 9:40
  Speaker 1: which is the Pentagon planning to lay off sixty thousand
• 9:43
  Speaker 1: civilian jobs. This is in the Devents department. That's a
• 9:45
  Speaker 1: five to eight percent work reduction. Around twenty one thousand
• 9:48
  Speaker 1: employees have already taken voluntary resignations. This is a large
• 9:52
  Speaker 1: amount of government jobs. You remember, the government is one
• 9:56
  Speaker 1: of the largest employers in the world, and especially here
• 9:59
  Speaker 1: in the United States. If you compare them to major industries.
• 10:02
  Speaker 1: Imagine if we saw a fifteen percent reduction of the
• 10:07
  Speaker 1: medical field or of the restaurant and hospitality field, those
• 10:10
  Speaker 1: are in excess of fifteen to twenty million jobs nationwide.
• 10:14
  Speaker 1: That's the kind of impact this could have, which we'll
• 10:18
  Speaker 1: roll into a potential impact on the markets in general.
• 10:22
  Speaker 1: All Right, I know chairpala is going to be coming
• 10:24
  Speaker 1: on here in a minute. He usually starts this around
• 10:27
  Speaker 1: two thirty and we'll air or we'll jump to that
• 10:30
  Speaker 1: right as we get going there when he takes the podium,
• 10:33
  Speaker 1: and we'll get a chance to listen in the way
• 10:34
  Speaker 1: this works, so in case you guys have never watched
• 10:36
  Speaker 1: this before, we'll listen to his remarks. There are questions
• 10:40
  Speaker 1: that will come in from the press corps. Most of
• 10:43
  Speaker 1: the time they're pretty good, some of them not so good.
• 10:46
  Speaker 1: But I'll give you a couple of inputs if I
• 10:48
  Speaker 1: think there's something that is kind of hidden in his
• 10:50
  Speaker 1: messages that we can dissect out of that based on
• 10:53
  Speaker 1: all of our research that we're seeing. So be on
• 10:56
  Speaker 1: the lookout for that, and sometimes stick around till the end,
• 11:00
  Speaker 1: because sometimes they'll drop a nugget at the end on
• 11:03
  Speaker 1: crypto and he'll answer it because he actually mentioned bitcoin
• 11:07
  Speaker 1: in the last one. So stick around till the end.
• 11:09
  Speaker 1: Here's Nick. He's coming in talking about the FED slowdown
• 11:13
  Speaker 1: QT last year in order to let that process run
• 11:16
  Speaker 1: for a little bit longer. Officials now are considering another
• 11:19
  Speaker 1: tweak and this is due to implications of the debt
• 11:22
  Speaker 1: limit situation. I remember, we have this debt not only
• 11:26
  Speaker 1: the debt limit, but we also have a large amount
• 11:28
  Speaker 1: of debt in the United States that we have to
• 11:31
  Speaker 1: service later this year. And this is where Trump and
• 11:36
  Speaker 1: the Fed. I'm not that I'm saying that they're working
• 11:39
  Speaker 1: in cahoots, but it's interesting that if we do get
• 11:42
  Speaker 1: a FED declining a funds rate, that would lower the
• 11:46
  Speaker 1: interest rate. And believe me, a one point difference for
• 11:50
  Speaker 1: the United States deficit is massive. It would be a
• 11:56
  Speaker 1: unbelievable We're talking about trillions of potential impacts a dollar's
• 11:59
  Speaker 1: impact here in terms of that. So he is right,
• 12:02
  Speaker 1: due to implications of the debt limits, situation could be
• 12:06
  Speaker 1: pretty big. So just be on the lookout for what's
• 12:09
  Speaker 1: going on right here. Mike Alford, though I think, had
• 12:11
  Speaker 1: a really good summary of this. Looks like pal is
• 12:15
  Speaker 1: going to go on. Before he goes, I want to
• 12:16
  Speaker 1: hit on this real quick. So he said, look at
• 12:19
  Speaker 1: QT ending and then dollar tanking, long term yields falling
• 12:25
  Speaker 1: into breaking out all time highs. Here we go.
• 12:28
  Speaker 3: Good afternoon, my colleagues, and I remain squarely focused on
• 12:32
  Speaker 3: achieving our dual mandate goals of maximum employment and stable
• 12:35
  Speaker 3: prices for the benefit of the American people. The economy
• 12:40
  Speaker 3: is strong overall and has made significant progress toward our
• 12:43
  Speaker 3: goals over the past two years. Labor market conditions are solid,
• 12:47
  Speaker 3: and inflation has moved closer to our two percent longer
• 12:50
  Speaker 3: run goal, so it remains somewhat elevated in support of
• 12:55
  Speaker 3: our goals. Today, the Federal Open Market Committee decided to
• 12:57
  Speaker 3: leave our policy interest rate unchanged. We also made the
• 13:01
  Speaker 3: technical decision to slow the pace of decline in the
• 13:04
  Speaker 3: size of our balance sheet. I'll have more to say
• 13:07
  Speaker 3: about these decisions. After briefly reviewing economic developments. Economic activity
• 13:13
  Speaker 3: continued to expand at a solid pace in the fourth
• 13:16
  Speaker 3: quarter of last year, with GDP rising at two point
• 13:19
  Speaker 3: three percent. Recent indications, however, point to a moderation in
• 13:23
  Speaker 3: consumer spending following the rapid growth seen over the second
• 13:27
  Speaker 3: half of twenty twenty four. Surveys of households and businesses
• 13:31
  Speaker 3: point to heightened uncertainty about the economic outlook. It remains
• 13:36
  Speaker 3: to be seen how these developments might affect future spending
• 13:39
  Speaker 3: and investment. In our summary of economic projections, the median
• 13:44
  Speaker 3: participant projects GDP to rise one point seven percent this year,
• 13:48
  Speaker 3: somewhat lower than projected in December, and to rise a
• 13:52
  Speaker 3: bit below two percent over the next two years. In
• 13:56
  Speaker 3: the labor market, conditions remain solid. Payroll job over two
• 14:00
  Speaker 3: hundred thousand per month over the past three months. The
• 14:03
  Speaker 3: unemployment rate, at four point one percent, remains low and
• 14:07
  Speaker 3: is held in a narrow range for the past year.
• 14:10
  Speaker 3: The jobs to workers gap has held steady for several months.
• 14:15
  Speaker 3: Wages are growing faster than inflation and at a more
• 14:17
  Speaker 3: sustainable pace then earlier in the pandemic recovery. Overall, a
• 14:23
  Speaker 3: wide set of indicators suggests that conditions in the labor
• 14:26
  Speaker 3: market are broadly in balance. The labor market is not
• 14:30
  Speaker 3: a source of significant inflationary pressures. The median projection for
• 14:35
  Speaker 3: the unemployment rate in the SEP is four point four
• 14:38
  Speaker 3: percent at the end of this year and four point
• 14:40
  Speaker 3: three percent over the next two years. Inflation has eased
• 14:45
  Speaker 3: significantly over the past two years, but remains somewhat elevated
• 14:48
  Speaker 3: relative to our two percent longer run goal. Estimates based
• 14:52
  Speaker 3: on the Consumer Price Index and other data indicate that
• 14:55
  Speaker 3: total PCEE prices arose two point five percent over the
• 14:58
  Speaker 3: twelve months ending in Wary and that excluding the volatle
• 15:02
  Speaker 3: food and energy categories, core PCE prices arose two point
• 15:06
  Speaker 3: eight percent. Some near term measures of inflation expectations have
• 15:11
  Speaker 3: recently moved up. We see this in both market and
• 15:14
  Speaker 3: survey based measures, and survey respondents, both consumers and businesses
• 15:19
  Speaker 3: are mentioning tariffs as a driving factor beyond the next
• 15:24
  Speaker 3: year or so. However, most measures of longer term expectations
• 15:27
  Speaker 3: remain consistent with our two percent inflation goal. The median
• 15:31
  Speaker 3: projection in the SEP for total PCEE inflation is two
• 15:34
  Speaker 3: point seven percent this year and two point two percent
• 15:37
  Speaker 3: next year, a little higher than projected in December. In
• 15:41
  Speaker 3: twenty twenty seven, the median projection is at our two
• 15:45
  Speaker 3: percent objective. Our monetary policy actions are guided by our
• 15:50
  Speaker 3: dual mandate to promote maximum employment and stable prices for
• 15:54
  Speaker 3: the American people. At today's meeting, the Committee decided to
• 15:58
  Speaker 3: maintain the target range for the federal funds rate at
• 16:01
  Speaker 3: four and a quarter to four and a half percent.
• 16:03
  Speaker 3: Looking ahead, the new administration is in the process of
• 16:06
  Speaker 3: implementing significant policy changes in four distinct areas, trade, immigration,
• 16:12
  Speaker 3: fiscal policy, and regulation. It is the net effect of
• 16:16
  Speaker 3: these policy changes that will matter for the economy and
• 16:19
  Speaker 3: for the path of monetary policy. While there have been
• 16:22
  Speaker 3: recent developments in some of these areas, especially trade policy,
• 16:26
  Speaker 3: uncertainty around the changes and their effects on the economic
• 16:28
  Speaker 3: outlook is high. As we parse the incoming information, We're
• 16:33
  Speaker 3: focused on separating the signal from the noise as the
• 16:36
  Speaker 3: outlook evolves. As we say in our statement, in considering
• 16:40
  Speaker 3: the extent and timing of additional adjustments to the target
• 16:43
  Speaker 3: range for the federal funds rate, the Committee will assess
• 16:46
  Speaker 3: incoming data, the evolving outlook and the balance of risks.
• 16:50
  Speaker 3: We do not need to be in a hurry to
• 16:52
  Speaker 3: adjust our policy stance, and we are well positioned to
• 16:55
  Speaker 3: wait for greater clarity. In our SEP FEMC participants wrote
• 17:01
  Speaker 3: down their individual assessments of an appropriate path for the
• 17:04
  Speaker 3: federal funds rate based on what each participant judges to
• 17:07
  Speaker 3: be the most likely scenario going forward, an admittedly challenging
• 17:12
  Speaker 3: exercise at this time in light of considerable uncertainty.
• 17:16
  Speaker 4: The median participant.
• 17:17
  Speaker 3: Projective the federal funds rate will be three point nine
• 17:21
  Speaker 3: percent at the end of this year and three point
• 17:23
  Speaker 3: four percent at the end of next year, unchanged from December.
• 17:28
  Speaker 3: While these individual forecasts are always subject to uncertainty. As
• 17:31
  Speaker 3: I noted, uncertainty today is unusually elevated, and of course
• 17:35
  Speaker 3: these projections are not a committee plan or a decision.
• 17:39
  Speaker 3: Policy is not on a preset course. As the economy
• 17:42
  Speaker 3: evolves quickly than anticipated, we can use policy accordingly. Our
• 17:46
  Speaker 3: current policy stance is well positioned to deal with the
• 17:49
  Speaker 3: risks and uncertainties that we face in pursuing both sides
• 17:53
  Speaker 3: of our dual mandate. At today's meeting, we also decided
• 17:57
  Speaker 3: to slow the pace of decline in our balance sheet.
• 18:00
  Speaker 3: Since we began balance sheet runoff, our securities holdings have
• 18:03
  Speaker 3: declined by more than two trillion dollars. While market indicators
• 18:07
  Speaker 3: continues to suggest that the quantity of reserves remains abundant,
• 18:11
  Speaker 3: we have seen some signs of increased tightness in money markets.
• 18:15
  Speaker 3: Beginning in April, the monthly cap on treasury redemptions will
• 18:18
  Speaker 3: be lowered from twenty five billion to five billion. Consistent
• 18:22
  Speaker 3: with the Committee's intention to hold primarily treasury securities in
• 18:25
  Speaker 3: the longer run, we are leaving the cap on agency
• 18:28
  Speaker 3: securities unchanged. This action has no implications for our intended
• 18:33
  Speaker 3: stance of monetary policy and should not affect the size
• 18:36
  Speaker 3: of our balance sheet over the medium term.
• 18:39
  Speaker 4: The Committee also continued its discussions.
• 18:41
  Speaker 3: As part of our five year review of our monetary
• 18:44
  Speaker 3: policy framework. At this meeting, we focused on labor market
• 18:47
  Speaker 3: dynamics and our maximum employment goal. As we have indicated,
• 18:51
  Speaker 3: our review will include outreach and public events involving a
• 18:54
  Speaker 3: wide range of parties, including FED listens events around the country,
• 18:58
  Speaker 3: and a research conference in May. Throughout this process, we
• 19:02
  Speaker 3: will be open to new ideas and critical feedback, and
• 19:05
  Speaker 3: we will take on board lessons of the last five
• 19:07
  Speaker 3: years in determining our findings. We intend to wrap up
• 19:11
  Speaker 3: the review by late summer. The FED has been assigned
• 19:15
  Speaker 3: two goals for monetary policy, maximum employment and stable prices.
• 19:19
  Speaker 3: We remain committed to supporting maximum employment, bringing inflation sustainably
• 19:24
  Speaker 3: to our two percent goal, and keeping longer term inflation
• 19:27
  Speaker 3: expectations well anchored. Our success in delivering on these goals
• 19:31
  Speaker 3: matters to all Americans. We understand that our actions affect communities, families,
• 19:36
  Speaker 3: and businesses across the country. Everything we do is in
• 19:39
  Speaker 3: service to our public mission we have the FED. We'll
• 19:42
  Speaker 3: do everything we can to achieve our maximum employment and
• 19:45
  Speaker 3: price stability goals.
• 19:46
  Speaker 4: Thank you. I will look forward to your questions, Howard
• 19:52
  Speaker 4: Scheiri orders, thanks for your time.
• 19:55
  Speaker 5: So two things on sort of the real side here
• 19:58
  Speaker 5: inflation and then GDP. How much of the higher inflation
• 20:02
  Speaker 5: forecast for this year is due to tariffs? And since
• 20:05
  Speaker 5: the policy path remains same, are you effectively reading.
• 20:09
  Speaker 4: This as a one time price level shock?
• 20:14
  Speaker 3: Okay, so how much of it is tariff? So let
• 20:17
  Speaker 3: me say that it is going to be very difficult
• 20:21
  Speaker 3: to have a precise assessment of how much of inflation
• 20:24
  Speaker 3: is coming from tariffs and from other and that's already
• 20:27
  Speaker 3: the case. You may have seen that goods inflation moved
• 20:31
  Speaker 3: up pretty significantly in the first two months of the year.
• 20:34
  Speaker 3: Trying to track that back to actual tariff increases given
• 20:38
  Speaker 3: what was tariff and what was not, very very challenging.
• 20:41
  Speaker 3: So some of it, the answer is clearly some of it.
• 20:44
  Speaker 3: A good part of it is coming from tariffs. But
• 20:47
  Speaker 3: we'll be working and so will other forecasters, to try
• 20:50
  Speaker 3: to find the best possible way to separate non tariff
• 20:54
  Speaker 3: inflation from tariff inflation.
• 20:57
  Speaker 4: In terms of.
• 20:59
  Speaker 3: Your sort of looking through question, too soon to say
• 21:03
  Speaker 3: about that. As I've mentioned, it can be the case
• 21:08
  Speaker 3: that it's appropriate sometimes to look through inflation if it's
• 21:10
  Speaker 3: going to go away quickly without action by us if
• 21:14
  Speaker 3: it's transitory, and that can be the case in the
• 21:17
  Speaker 3: case of tariff inflation.
• 21:20
  Speaker 4: I think that would depend on.
• 21:23
  Speaker 3: The tariff inflation moving through fairly quickly, and would depend
• 21:27
  Speaker 3: critically as well on inflation expectations being well anchored longer
• 21:31
  Speaker 3: term inflation expectations being well anchored.
• 21:33
  Speaker 5: Well, I guess I'm looking at the out years here,
• 21:36
  Speaker 5: and the fact that the policy path doesn't change at
• 21:38
  Speaker 5: all and inflation is unchanged in the out years also
• 21:44
  Speaker 5: doesn't that imply you all have basically decided that there
• 21:47
  Speaker 5: is no signal here and that it's just kind of
• 21:50
  Speaker 5: we're back to transitory again.
• 21:52
  Speaker 3: So I think I think that's kind of the base case.
• 21:55
  Speaker 3: But as I said, we really can't know that We're
• 21:58
  Speaker 3: going to have to see how things actually act work out.
• 22:00
  Speaker 3: And the fact that there wasn't much change, I think
• 22:03
  Speaker 3: that's that's partly because you know, you see weaker growth
• 22:07
  Speaker 3: but higher inflation they kind of offset, and also frankly
• 22:10
  Speaker 3: a little bit of inertia when it comes to changing
• 22:13
  Speaker 3: something in this highly uncertain environment. You know, you're you know,
• 22:16
  Speaker 3: I think there's a level of inertia where you just say,
• 22:18
  Speaker 3: maybe I'll stay where I ambe.
• 22:24
  Speaker 6: Thank you, Coby Smith with the New York Times. You
• 22:26
  Speaker 6: just describe inflation expectations as well anchored. But has your
• 22:29
  Speaker 6: confidence in that assessment changed it all given the increase
• 22:32
  Speaker 6: in certain measures and the high degree of uncertainty expressed
• 22:35
  Speaker 6: by businesses, households and forecasters so.
• 22:38
  Speaker 4: On inflation expectations.
• 22:40
  Speaker 3: Of course, we do monitor inflation expectations very very carefully,
• 22:43
  Speaker 3: basically every source we can find, and you know, short term,
• 22:47
  Speaker 3: long term, households, businesses, forecasters, market based, and I think
• 22:51
  Speaker 3: the picture broadly is this. You do see increases widely
• 22:56
  Speaker 3: in short term inflation expectations, and people who fill out
• 23:00
  Speaker 3: surveys and answer, you know, questionnaires are pointing to tariffs
• 23:05
  Speaker 3: about that. If you look in the survey world, if
• 23:08
  Speaker 3: you look a little further out, you really don't see
• 23:13
  Speaker 3: much in the way of an increased longer term inflation.
• 23:16
  Speaker 3: Inflation expectations are mostly well anchored. If you look at
• 23:18
  Speaker 3: the New York for example, then you have market based
• 23:22
  Speaker 3: and it's the same pattern. You know, people in markets
• 23:25
  Speaker 3: are pricing in and break evens. Some higher inflation over
• 23:29
  Speaker 3: the next year must be related to tariffs, we know
• 23:32
  Speaker 3: from the surveys, but if you look out five years
• 23:35
  Speaker 3: or the five year five year forward, you'll see that
• 23:39
  Speaker 3: break evens or either flat or actually slightly down in
• 23:42
  Speaker 3: the case of the longer term one. So we look
• 23:44
  Speaker 3: at that and we will be watching all of it
• 23:47
  Speaker 3: very very carefully.
• 23:48
  Speaker 4: We do not take anything for granted.
• 23:50
  Speaker 3: It's at the very heart of our framework angered inflation expectations.
• 23:53
  Speaker 4: But that's what you see right now. And how much
• 23:56
  Speaker 4: weight do.
• 23:57
  Speaker 6: You put on the deterioration in consumer confidence surveys? You
• 24:01
  Speaker 6: said recently that this is perhaps not the best indication
• 24:05
  Speaker 6: of future spending. But I'm curious you know what you
• 24:09
  Speaker 6: think is behind this deterioration and to what extent it
• 24:13
  Speaker 6: could be a leading indicator for hard data.
• 24:15
  Speaker 3: So let's start with the hard data. You know, we
• 24:18
  Speaker 3: do see pretty solid hard data still. So growth looks
• 24:22
  Speaker 3: like it's maybe moderating a bit, consumer spending moderating a bit,
• 24:25
  Speaker 3: but still at a solid pace. Unemployment's four point one percent,
• 24:30
  Speaker 3: job creation most recently has been at a healthy level.
• 24:33
  Speaker 3: Inflation has started to move up now, we think partly
• 24:36
  Speaker 3: in response to tariffs, and there may be a delay
• 24:40
  Speaker 3: in further progress over the course of this year. So
• 24:43
  Speaker 3: that's the hard data. Overall, it's a solid picture. The
• 24:47
  Speaker 3: survey data, both household and businesses show significant rise in
• 24:52
  Speaker 3: uncertainty and significant concerns about downside risks.
• 24:55
  Speaker 4: So how do we think about that? And that's that
• 24:57
  Speaker 4: is the question.
• 24:59
  Speaker 3: As I mentioned and the other day, as you pointed out,
• 25:03
  Speaker 3: the relationship between survey data and actual economic activity hasn't
• 25:06
  Speaker 3: been very tight. There have been plenty of times where
• 25:10
  Speaker 3: people are saying very downbeat things about the economy and
• 25:13
  Speaker 3: then going out and buying a new car. But we
• 25:16
  Speaker 3: don't know that that will be the case here. We
• 25:18
  Speaker 3: will be watching very carefully for signs of weakness in
• 25:21
  Speaker 3: the real data, of course we will. But you know,
• 25:24
  Speaker 3: given where we are, we think our policy is in
• 25:26
  Speaker 3: a good place UH to react to what comes, and
• 25:30
  Speaker 3: we think that the right thing to do is to
• 25:32
  Speaker 3: wait here for great for you, for greater clarity about
• 25:36
  Speaker 3: what the economy is doing.
• 25:42
  Speaker 7: Nick Timrose to the Wall Street Journal Chapel chair green
• 25:45
  Speaker 7: Span once to fine price stability as as an environment
• 25:48
  Speaker 7: in which inflation is so low and stable over time
• 25:50
  Speaker 7: that it doesn't materially enter UH into the decisions of
• 25:55
  Speaker 7: households and firms. Can you say that today that we
• 25:58
  Speaker 7: have that price stability that households and businesses or during
• 26:01
  Speaker 7: price when you see buy an advanced psychology changes and
• 26:06
  Speaker 7: inventories and surveys to show consumers, at least in the
• 26:10
  Speaker 7: short run, expect higher inflation.
• 26:13
  Speaker 4: I do that definition a lot.
• 26:15
  Speaker 3: In fact, I used it at the recent conference where
• 26:18
  Speaker 3: I spoke. So I think a world where people can
• 26:21
  Speaker 3: make their daily economic decisions and businesses and they're not
• 26:24
  Speaker 3: having to think about the possibility of significantly high inflation.
• 26:28
  Speaker 3: We know inflation will bounce around. That is price stability,
• 26:31
  Speaker 3: you know. I think we were getting closer and closer
• 26:34
  Speaker 3: to that. I wouldn't say we were at that inflation
• 26:37
  Speaker 3: was running around two and a half percent for some time.
• 26:40
  Speaker 3: I do think with the arrival of the tariff, inflation
• 26:45
  Speaker 3: further progress may be delayed. The SEP doesn't really show
• 26:49
  Speaker 3: further downward progress on inflation this year, and that that's
• 26:51
  Speaker 3: really due to the tariffs coming in so delayed. But
• 26:55
  Speaker 3: if you look at our forecasts, we do see ourselves
• 26:57
  Speaker 3: getting back into the load. Who's in twenty six and
• 27:01
  Speaker 3: then down to two by twenty seven. Of course, highly
• 27:03
  Speaker 3: uncertain so I see progress having been made toward that,
• 27:07
  Speaker 3: and then progress in the future. I think that progress
• 27:10
  Speaker 3: is probably delayed for the time being.
• 27:12
  Speaker 7: If that's the case, why are there cuts in the
• 27:14
  Speaker 7: SEP for twenty twenty five.
• 27:17
  Speaker 3: So again, people wrote down two cuts the last time,
• 27:20
  Speaker 3: and they look at the you know, the they wrote down,
• 27:25
  Speaker 3: you know, meaningful decline in growth from two point one
• 27:29
  Speaker 3: to one point seven in twenty twenty five, a tick
• 27:32
  Speaker 3: up in the unemployment rates are not much there, but
• 27:34
  Speaker 3: core inflation up by three tenths, and so those two
• 27:37
  Speaker 3: kind of those kind of balance each other out. So people,
• 27:40
  Speaker 3: not everybody, but on balance people wrote down similar numbers.
• 27:44
  Speaker 4: The changes aren't that big.
• 27:45
  Speaker 3: The other factor, though, as I mentioned, is just really
• 27:48
  Speaker 3: high uncertainty.
• 27:49
  Speaker 4: What would you write down?
• 27:50
  Speaker 3: I mean, it's just it's really hard to know how
• 27:54
  Speaker 3: this is going to work out.
• 27:55
  Speaker 4: And again, we think our policy is in a good place.
• 27:58
  Speaker 3: We think it's a good place where we can move
• 28:00
  Speaker 3: in the direction that need where we need to. But
• 28:02
  Speaker 3: in the meantime it's really appropriate to wait for further clarity.
• 28:07
  Speaker 3: And of course, you know, the costs of doing that,
• 28:09
  Speaker 3: given that the economy is still solid, are very low.
• 28:14
  Speaker 8: Edler thank you, mister chairman, Edwin Lawrence and Fox Business.
• 28:19
  Speaker 8: So with near four percent unemployment rate, that should be
• 28:22
  Speaker 8: low enough to bring people in from the sidelines in
• 28:25
  Speaker 8: terms of hiring. But we're seeing the hiring rates have
• 28:28
  Speaker 8: been stuck at twenty twenty three, twenty twenty four levels.
• 28:30
  Speaker 8: So what's going on there?
• 28:32
  Speaker 4: Yeah, so.
• 28:34
  Speaker 3: That's a feature of that has been for some time
• 28:36
  Speaker 3: a feature of this labor market. You have pretty high
• 28:38
  Speaker 3: participation accounting for aging. You've got wages that are consistent
• 28:43
  Speaker 3: with two percent inflation, assuming that we're going to keep getting,
• 28:46
  Speaker 3: you know, relatively high productivity. We've got unemployment, you know,
• 28:49
  Speaker 3: pretty close to its natural level, but job the hiring
• 28:55
  Speaker 3: rate is quite low.
• 28:56
  Speaker 4: But so is the layoff rate.
• 28:57
  Speaker 3: So you look at initial claims or layoffs, so you're
• 29:01
  Speaker 3: not seeing people losing their jobs, but you're seeing that
• 29:03
  Speaker 3: people who don't have a job having to wait longer
• 29:05
  Speaker 3: and longer, and you know, the questions, which way does
• 29:08
  Speaker 3: that break? If we were to see a meaningful increase
• 29:11
  Speaker 3: in layoffs, then that would probably translate fairly quickly into
• 29:15
  Speaker 3: unemployment because people are you know, it's it's not a
• 29:19
  Speaker 3: big hiring market. We've been watching that and it's just
• 29:22
  Speaker 3: not in the data. It hasn't happened. What we've had
• 29:25
  Speaker 3: is a low firing, low hiring situation, and it seems
• 29:28
  Speaker 3: to be in balance now for you know, for the
• 29:31
  Speaker 3: last six seven, eight months, that's where we are. There's
• 29:35
  Speaker 3: healthy levels of job creation too, So overall it's a
• 29:38
  Speaker 3: labor market that's in balance, and you know, we watch
• 29:40
  Speaker 3: it very carefully.
• 29:42
  Speaker 8: So then, have we seen the administration, the new administration's
• 29:44
  Speaker 8: policies in the economic numbers yet? And when do you
• 29:47
  Speaker 8: anticipate that happening in labor or in other in labor
• 29:50
  Speaker 8: and inflation just across the economy. Have we started to
• 29:52
  Speaker 8: see the new policies take effect in the.
• 29:54
  Speaker 4: Numbers, you know, only in a kind of an early way.
• 30:00
  Speaker 3: I mean it's only been a few months, right, you know,
• 30:03
  Speaker 3: for example, the layoffs that are happening here are you know,
• 30:08
  Speaker 3: they're certainly meaningful to the people involved, and they may
• 30:10
  Speaker 3: be meaningful to a particular neighborhood or a region or area.
• 30:14
  Speaker 3: But at the national level they're not significant yet. But
• 30:17
  Speaker 3: we don't know, we don't know what where that how
• 30:19
  Speaker 3: far that will go. We'll find out much more. I
• 30:21
  Speaker 3: mentioned that you you saw We've had two very strong
• 30:26
  Speaker 3: goods inflation readings in the last two months, which is
• 30:29
  Speaker 3: very unexpected. I think hard to trace it to specific tariffs,
• 30:34
  Speaker 3: but it must have it must have something to do
• 30:36
  Speaker 3: with It's either noise and it will come back and
• 30:39
  Speaker 3: that that's very possible too. But if it is persistent,
• 30:41
  Speaker 3: then it must be to do with, you know, people
• 30:44
  Speaker 3: buying ahead of tariffs or raising prices ahead of tariffs
• 30:47
  Speaker 3: and things like that. That those kinds of things happen,
• 30:49
  Speaker 3: and they're very very hard to capture because so much
• 30:52
  Speaker 3: of it is indirect A great example is there are
• 30:56
  Speaker 3: washing machines were tariffed in the last last round of
• 30:58
  Speaker 3: tariffs and prices went up, but prices also went up
• 31:01
  Speaker 3: on dryers which were not tariffed, so the manufacturers just,
• 31:06
  Speaker 3: you know, they just kind of follow the crowd and
• 31:08
  Speaker 3: raised it. So things happened very indirectly, and so there'll
• 31:12
  Speaker 3: be a lot of work done in coming months to
• 31:15
  Speaker 3: try to trace all that through. But ultimately though it's
• 31:17
  Speaker 3: too soon to be seeing significant effects in economic data.
• 31:24
  Speaker 9: Craig Taurus from Bloomberg's Thanks Cherpall, you said, transitory price
• 31:29
  Speaker 9: increases from tariffs are the base case transitory is the
• 31:33
  Speaker 9: base case? Wasn't it the base case last time? And
• 31:37
  Speaker 9: didn't the FMC forecast lower inflation ahead last time? And
• 31:42
  Speaker 9: wasn't the lesson that it quickly got into services, haircuts, daycare,
• 31:46
  Speaker 9: everything else. And so I'm just wondering why the nine
• 31:50
  Speaker 9: aren't taking that on board and are cutting twice this year.
• 31:55
  Speaker 4: When you say last time, are you talking about the landemic?
• 31:57
  Speaker 3: Yes, you could have been talking about the last time
• 32:00
  Speaker 3: there were tariffs, in which case the inflation was was transitory. Yeah, no,
• 32:05
  Speaker 3: of course, we're well aware of that. And uh, you know,
• 32:08
  Speaker 3: it's it's still the truth. If if there's an inflationary
• 32:13
  Speaker 3: impulse that's going to go away on its own, it's
• 32:16
  Speaker 3: not the right policy to to tighten policy because by
• 32:20
  Speaker 3: the time you have your effect, you're you know, you're
• 32:22
  Speaker 3: in effect that by by design, you are lowering economic
• 32:26
  Speaker 3: activity and employment. And if that's not necessary, you don't
• 32:29
  Speaker 3: want to do it in real time. As we know,
• 32:32
  Speaker 3: it's hard to make that judgment. Uh So, and we're
• 32:35
  Speaker 3: well aware, uh you know of what happened obviously with
• 32:39
  Speaker 3: with with with the pandemic inflation. But I mean, we
• 32:42
  Speaker 3: have to look at this as as as a different situation.
• 32:46
  Speaker 3: There's there are differences in similarities. Uh, I mean it's
• 32:49
  Speaker 3: a different time. You know, we haven't had real price
• 32:52
  Speaker 3: stability fully re established yet and we have to keep.
• 32:55
  Speaker 4: That in mind.
• 32:56
  Speaker 3: And you know, we also have we hear that people
• 32:59
  Speaker 3: are very related to take on you know, to allow
• 33:03
  Speaker 3: prices to go up. At the same time, we hear
• 33:05
  Speaker 3: that businesses are intending to pass many.
• 33:07
  Speaker 4: Of these prices through. So it's hard to say how
• 33:08
  Speaker 4: this is going to work out.
• 33:11
  Speaker 10: See Steve Leiceman, CNBC. Thanks for taking my question, mister Chairman.
• 33:18
  Speaker 10: The Bank of Canada and its last policy statement said
• 33:21
  Speaker 10: monetary policy cannot offset the impacts of a trade war.
• 33:24
  Speaker 10: What it can and must do is ensure that higher
• 33:26
  Speaker 10: prices do not lead to ongoing inflation. I wonder if
• 33:30
  Speaker 10: that kind of reflects your own sense of prioritization faced
• 33:34
  Speaker 10: with higher prices and weaker growth, that the idea is
• 33:37
  Speaker 10: you have to take care of inflation.
• 33:40
  Speaker 4: You know.
• 33:40
  Speaker 3: So we have two goals, right, we have maximum employment
• 33:43
  Speaker 3: and price stability, and we have to balance those and
• 33:46
  Speaker 3: you know there can be situations in which they are
• 33:48
  Speaker 3: intention right, and we have actually have a provision in
• 33:51
  Speaker 3: our consensus statement that says what we should do in
• 33:54
  Speaker 3: that case. That's a very challenging, uh, you know, situation
• 33:58
  Speaker 3: for any central bank and certainly for us. And so
• 34:01
  Speaker 3: what we say that we'll do is we'll we'll look
• 34:03
  Speaker 3: how far each of those two goals is, for each
• 34:06
  Speaker 3: of those two measures is from its goal, and then
• 34:09
  Speaker 3: we'll ask how long we think it might take to
• 34:12
  Speaker 3: get back to the goal for each of them, and
• 34:13
  Speaker 3: we'll make a judgment. Because you know, our tools work
• 34:16
  Speaker 3: in one direction. We're either tightening or loosening. So it's
• 34:19
  Speaker 3: a very challenging situation. Let me say we don't have
• 34:22
  Speaker 3: that situation right now. That's not what the that's not
• 34:24
  Speaker 3: where the economy is at all. It's also not where
• 34:27
  Speaker 3: the forecast is. I don't know any mainstream forecasts that
• 34:30
  Speaker 3: really show significant problems like that.
• 34:33
  Speaker 4: So well, just to follow.
• 34:35
  Speaker 10: Up yesterday, the UCLA Anderson forecast said, the high probability
• 34:40
  Speaker 10: of a recession where do you stand on whether or
• 34:43
  Speaker 10: not there's slow down you're seeing, creates a higher probability
• 34:45
  Speaker 10: or concern that you may have on recession.
• 34:47
  Speaker 4: Thank you.
• 34:48
  Speaker 3: You know, there's always an unconditional probability possibility of a recession.
• 34:53
  Speaker 3: It might be broadly in the range of one in
• 34:55
  Speaker 3: four at any time. If you look back through through
• 34:58
  Speaker 3: the years, there could be within twelve months one and
• 35:01
  Speaker 3: four chance of a recession. So the question is whether
• 35:03
  Speaker 3: that whether this current situation, those possibilities are elevated. I
• 35:09
  Speaker 3: will say this, we don't make such a forecast. If
• 35:12
  Speaker 3: you look at outside forecasts, forecasters have generally raised A
• 35:16
  Speaker 3: number of them have raised their possibility of a recession somewhat,
• 35:22
  Speaker 3: but still at relatively moderate levels, you know, still in
• 35:24
  Speaker 3: the region of the traditional because they were extremely low.
• 35:27
  Speaker 3: If you go back two months, people were saying that
• 35:30
  Speaker 3: the likelihood of a recession was extremely low. So has
• 35:33
  Speaker 3: moved up, but it's not high.
• 35:36
  Speaker 11: Chris Hi, thank you, Chris Rugaber and associated Press. As
• 35:44
  Speaker 11: you know, I guess last night the President Trump fired
• 35:47
  Speaker 11: two members of the Federal Trade Commission, an independent agency,
• 35:51
  Speaker 11: and this could cause the kind of legal fight about
• 35:54
  Speaker 11: the administration's power to fire independent people. If those firing stand,
• 35:59
  Speaker 11: is that a threat of the Fed's independence.
• 36:02
  Speaker 4: Could he do the same thing to the FED Board?
• 36:05
  Speaker 3: So I think I did answer that question in this
• 36:07
  Speaker 3: very room some time ago, and I have no desire
• 36:11
  Speaker 3: to change that answer and have nothing new for you
• 36:13
  Speaker 3: on that today.
• 36:15
  Speaker 2: Well I just okay, well, maybe I'll have another mulligan,
• 36:21
  Speaker 2: as I wanted to go back to the consumer sentiment,
• 36:24
  Speaker 2: particularly the inflation expectations in the University of Michigan survey
• 36:28
  Speaker 2: in the summer of twenty twenty two.
• 36:29
  Speaker 11: You cided the rise in the long term inflation expectations
• 36:33
  Speaker 11: in that index as the reason that you went big
• 36:36
  Speaker 11: with a three quarter point hike. So I know you've
• 36:39
  Speaker 11: you've talked about all the different measures now, but you
• 36:41
  Speaker 11: seem to not be placing the same weight on that.
• 36:44
  Speaker 11: And I'm just wondering, are you dismissing that what we
• 36:47
  Speaker 11: saw last week from the University of Michigan or you
• 36:50
  Speaker 11: just carry the same weight as it did in the past.
• 36:52
  Speaker 3: So I mentioned it back then, but in no way
• 36:55
  Speaker 3: did I place a huge weight on it. I think
• 36:58
  Speaker 3: that was a X Post story. If it wasn't the case,
• 37:02
  Speaker 3: that was a preliminary reading. And so is this. And
• 37:04
  Speaker 3: it's also this is that Michigan the one you're referring to,
• 37:07
  Speaker 3: the longer term thing? You know, we look at it.
• 37:09
  Speaker 3: We don't dismiss data that we don't like. We we
• 37:12
  Speaker 3: force ourselves to look at it. But it is an
• 37:14
  Speaker 3: outlier compared to market based and compared to other survey
• 37:18
  Speaker 3: based assessments of longer run inflation expectations.
• 37:23
  Speaker 4: So we got to keep that in mind. And again,
• 37:26
  Speaker 4: I uh, I would just say.
• 37:28
  Speaker 3: We look at we look at all of them, and
• 37:30
  Speaker 3: that one's that was kind of an outlier, but you know,
• 37:33
  Speaker 3: nonetheless we take notice of it.
• 37:36
  Speaker 12: Right Michael McKee from Bloomberg Radio on television, there is
• 37:43
  Speaker 12: a worry on Wall Street that when you say you
• 37:45
  Speaker 12: want to study the net effect of the fiscal policies
• 37:50
  Speaker 12: we may see on the economy, that you would end
• 37:52
  Speaker 12: up waiting too long and be behind the curve and
• 37:55
  Speaker 12: responding to any downturn. How can you reassure people that
• 38:00
  Speaker 12: you can spot a problem early enough unless you decide
• 38:05
  Speaker 12: to be preemptive.
• 38:08
  Speaker 4: Yeah, look, we're aware of that.
• 38:10
  Speaker 3: We're well aware of how things are going to evolve
• 38:12
  Speaker 3: in the timeframes and all that, and you know, we
• 38:14
  Speaker 3: will use our tools to foster achievement of our goals
• 38:16
  Speaker 3: to the best we can, and of course we're going
• 38:20
  Speaker 3: to try to be timely with that.
• 38:22
  Speaker 4: For right now, the hard data are pretty solid.
• 38:25
  Speaker 3: We are obviously aware of the soft sentiment data and
• 38:29
  Speaker 3: high uncertainty, and we're watching that carefully and we think
• 38:32
  Speaker 3: it's a good time for us to wait for further
• 38:35
  Speaker 3: clarity before we consider adjusting our policy stamps.
• 38:38
  Speaker 12: Do you think it's going to be hard to get
• 38:40
  Speaker 12: clarity in a government by tweet? I mean, do you
• 38:43
  Speaker 12: have a feeling that at some point you actually will
• 38:46
  Speaker 12: have a forecast you can trust?
• 38:48
  Speaker 4: Yes, I think we will.
• 38:49
  Speaker 3: I just it's hard to say when that will be.
• 38:53
  Speaker 3: You know, these decisions are going to be made and
• 38:56
  Speaker 3: they're going to be implemented, and then we'll know at
• 38:58
  Speaker 3: that well, we'll know what the decisions are. We'll have
• 39:00
  Speaker 3: to make assessments then about the implications for the economy.
• 39:03
  Speaker 3: Those things will happen, A lot of them will happen
• 39:05
  Speaker 3: over the course of you know, in coming months, certainly
• 39:07
  Speaker 3: over the course of this year, and will be adapting
• 39:10
  Speaker 3: as we go.
• 39:12
  Speaker 13: Rachel hi Chapal Rachel Siegel from the Washington Post, thank
• 39:18
  Speaker 13: you for taking our questions. At the beginning, you were
• 39:21
  Speaker 13: talking about separating the signal from the noise and tariff
• 39:24
  Speaker 13: inflation from non tariff inflation. Can you walk us through
• 39:27
  Speaker 13: what that looked like over the last couple of months.
• 39:29
  Speaker 13: If there were specifics from the January meaning to now
• 39:32
  Speaker 13: that helped you make those distinctions.
• 39:34
  Speaker 3: So when we say separating this signal from the noise,
• 39:37
  Speaker 3: that's just a way of saying that things are highly
• 39:39
  Speaker 3: uncertain and that you know, you're reading about developments. The
• 39:42
  Speaker 3: news is full of developments of tariffs being put on
• 39:45
  Speaker 3: and taken off and things like that. That's some of
• 39:48
  Speaker 3: that is noise in the sense that it's it's not
• 39:50
  Speaker 3: really telling you anything. You're trying to extract a signal
• 39:53
  Speaker 3: from that, and the signal is what's going to be
• 39:56
  Speaker 3: the effect on economic activity, on inflation, on employment and
• 39:59
  Speaker 3: all the things. So so that's really when we say
• 40:02
  Speaker 3: signal and noise.
• 40:02
  Speaker 4: Sorry. The second thing was or.
• 40:05
  Speaker 13: Similarly for tariff inflation, on tariff inflation ways that you're
• 40:07
  Speaker 13: making the.
• 40:08
  Speaker 3: Discussions, that's sort of a special case of that, you know,
• 40:11
  Speaker 3: with the idea being and I think do think that
• 40:14
  Speaker 3: the first two months of this year are a great example.
• 40:16
  Speaker 3: You've got high readings for goods inflation after a string
• 40:20
  Speaker 3: of readings that average close to zero, and you have
• 40:23
  Speaker 3: to ask it's coming during tariffs. But you know, it's
• 40:26
  Speaker 3: very hard to actually scientifically go back and match up
• 40:29
  Speaker 3: those increases and say, yes, I can prove that that's
• 40:32
  Speaker 3: from tariffs, but it kind of has to be to
• 40:34
  Speaker 3: some extent. Plus noise, there can be idiosyncratic readings in
• 40:38
  Speaker 3: various categories which will shortly reverse, and that that happens too,
• 40:41
  Speaker 3: and that could be a big piece of it.
• 40:43
  Speaker 14: You know.
• 40:43
  Speaker 3: I think we'll know in a couple of months, we'll
• 40:45
  Speaker 3: know whether those were you know, where that really was from.
• 40:47
  Speaker 3: But that's another case where I think it's going to
• 40:50
  Speaker 3: be very, very challenging to unpack the inflation that we
• 40:55
  Speaker 3: see over the course of this year and be able
• 40:57
  Speaker 3: to say with confidence how much of that came from inflation,
• 41:00
  Speaker 3: and how much of it sorry from tariffs, and how
• 41:02
  Speaker 3: much of it didn't.
• 41:04
  Speaker 4: But that's what we're doing.
• 41:05
  Speaker 3: We'll be doing that and so will everybody else, and
• 41:07
  Speaker 3: we'll all be trying very hard to make that assessment.
• 41:10
  Speaker 3: And you know, I'm sure we will make a lot
• 41:12
  Speaker 3: of progress on that, and we already have, but it's
• 41:15
  Speaker 3: going to be a challenge.
• 41:16
  Speaker 13: Do you have a sense yet as to what, in
• 41:17
  Speaker 13: your mind would make something cross from noise to a signal,
• 41:21
  Speaker 13: What that threshold would look like.
• 41:22
  Speaker 4: You know, it would depend on what we're talking about.
• 41:24
  Speaker 3: I mean, obviously you're looking for direct evidence that that
• 41:28
  Speaker 3: particular pieces of inflation are or clearly not caused by tariffs.
• 41:34
  Speaker 3: For example, it's something that was you know, in the
• 41:37
  Speaker 3: service sector that was far away from anything that's tariffed.
• 41:40
  Speaker 3: You might think, okay, well that is like frankly, housing
• 41:43
  Speaker 3: services inflation, which which by the way, has been behaving well,
• 41:47
  Speaker 3: you know, which for some time was kind of our problem.
• 41:51
  Speaker 3: Now it's been it's slow, but it's definitely you know,
• 41:55
  Speaker 3: moving down.
• 41:55
  Speaker 4: In a very good way.
• 41:57
  Speaker 3: It's more now with goods and to some extent with
• 42:00
  Speaker 3: with non housing services inflation.
• 42:04
  Speaker 15: Sure, thanks for taking our questions, Chair Powell, Kelly o Grady,
• 42:09
  Speaker 15: CBS News. So consumer sentiment has dipped dramatically, but you
• 42:14
  Speaker 15: say the economy and the hard data is still solid.
• 42:18
  Speaker 15: What is your message to consumers that clearly disagree and
• 42:22
  Speaker 15: don't feel that strength because the hard data they're looking
• 42:25
  Speaker 15: at is their grocery bill.
• 42:27
  Speaker 4: Okay, so a couple things.
• 42:28
  Speaker 3: The grocery bill is about past inflation, really, and there
• 42:32
  Speaker 3: was inflation in twenty one to two and three when
• 42:34
  Speaker 3: prices went up the current level. It's not the change
• 42:37
  Speaker 3: in prices it's they're unhappy, and they're not wrong to
• 42:41
  Speaker 3: be unhappy that prices went up quite a bit and
• 42:44
  Speaker 3: they're paying a lot for those things.
• 42:46
  Speaker 4: So that's I think that is the fundamental fact and has.
• 42:48
  Speaker 3: Been for a long time, a couple of years, why
• 42:50
  Speaker 3: people are unhappy with the with the economy. It's not
• 42:54
  Speaker 3: that the economy is not growing, it's not that inflation
• 42:56
  Speaker 3: is really high. It's not that unemployment is high. It's
• 42:58
  Speaker 3: none of those things. We have, you know, four point
• 43:01
  Speaker 3: one percent unemployment. We've got two percent growth, and you know,
• 43:05
  Speaker 3: it's it's a pretty good economy. But people are unhappy
• 43:08
  Speaker 3: because of the price level, and I do we completely
• 43:10
  Speaker 3: understand and accept that.
• 43:12
  Speaker 15: And just to follow up, why are you still projecting
• 43:15
  Speaker 15: two rate cuts this year if your own projections show
• 43:19
  Speaker 15: inflation higher for longer, does that mean you see a
• 43:22
  Speaker 15: slow down in economic growth as a real threat?
• 43:25
  Speaker 3: So I think if you yeah, I mean, remember we
• 43:29
  Speaker 3: came into this with at the December meeting. The medium
• 43:33
  Speaker 3: was two cuts. The medium was so you come in
• 43:36
  Speaker 3: and you see broadly speaking, weaker growth but higher inflation,
• 43:41
  Speaker 3: and they kind of balance each other out, so you
• 43:43
  Speaker 3: think and unemployment is really they're really only only a
• 43:46
  Speaker 3: one tenth change, So it's there's just not a big
• 43:49
  Speaker 3: change in the forecast. There really isn't modest you know,
• 43:53
  Speaker 3: meaningfully higher on sorry growth and meaningfully higher inflation, which
• 43:58
  Speaker 3: call for different responses, right, so they cancel each other out,
• 44:01
  Speaker 3: and people have said, Okay, I'm going to stay here.
• 44:04
  Speaker 3: But the second factor is it's so highly uncertain. Is
• 44:07
  Speaker 3: just you know, we're sitting here thinking, and we obviously
• 44:10
  Speaker 3: are in touch with businesses and households all over the country.
• 44:14
  Speaker 3: We have an extraordinary network of contacts that come in
• 44:18
  Speaker 3: through the Reserve banks and put in the Beige Book,
• 44:21
  Speaker 3: and also through contacts at the Board, and we get
• 44:24
  Speaker 3: all that, and we do understand that sentiment has fallen
• 44:26
  Speaker 3: off pretty sharply, but economic activity is not yet, and
• 44:30
  Speaker 3: so we're watching carefully. So I would tell people that
• 44:34
  Speaker 3: the economy seems to be seems to be healthy. We
• 44:37
  Speaker 3: understand that sentiment is quite negative at this time, and
• 44:42
  Speaker 3: that probably has to do with you know, turmoil at
• 44:45
  Speaker 3: the beginning of an administration that's making you know, big
• 44:49
  Speaker 3: changes in areas of policy, and that's probably part of it.
• 44:54
  Speaker 3: I do think the underlying unhappiness people have about the economy, though.
• 44:57
  Speaker 4: Is more is more of at the price level?
• 45:01
  Speaker 16: Pa cure.
• 45:04
  Speaker 4: Hi Victoria Weeda with Politico.
• 45:07
  Speaker 17: I wanted to ask, first of all, if you could
• 45:09
  Speaker 17: clarify you were talking about how tariffs were a good
• 45:13
  Speaker 17: part of the uptick in the inflation forecast, and I
• 45:16
  Speaker 17: was just wondering what that specifically refers to, is that
• 45:19
  Speaker 17: the tariffs that have already been put in place, Is
• 45:22
  Speaker 17: that anticipating some of the tariffs that might be coming
• 45:24
  Speaker 17: on April second? And then also if you wouldn't mind
• 45:28
  Speaker 17: talking a little more about the balance sheet decision and
• 45:30
  Speaker 17: what drove that. Did that have anything to do with
• 45:34
  Speaker 17: expectations of how the debt ceiling, raising the debt ceiling
• 45:36
  Speaker 17: might affect the reserve supply?
• 45:38
  Speaker 3: Yeah, So in the SEP you'll see that there's not
• 45:41
  Speaker 3: further progress on core inflation this year. We're kind of
• 45:45
  Speaker 3: side flat lining, going sideways. We don't ask people to
• 45:48
  Speaker 3: say to write down how much of this is from
• 45:50
  Speaker 3: tariffs and how much of it is not, but some
• 45:52
  Speaker 3: of it is from tariffs. We know that tariffs are
• 45:54
  Speaker 3: coming in, we know that they're probably already. All forecasters
• 45:58
  Speaker 3: have tariff inflation affecting core PC inflation core CPI inflation
• 46:03
  Speaker 3: this year without exception. I'm not aware of an exception,
• 46:06
  Speaker 3: so it's in there. I can't tell you how much
• 46:08
  Speaker 3: of that it is in terms of the balance sheet.
• 46:11
  Speaker 3: So yeah, we I think, I guess the way i'd
• 46:14
  Speaker 3: say it is, you know, it was the flows in
• 46:19
  Speaker 3: and out of the the TGA that got us thinking
• 46:22
  Speaker 3: about it. But as we you know, as we thought
• 46:25
  Speaker 3: about it, we really came to the view that this
• 46:28
  Speaker 3: was a good time to make.
• 46:31
  Speaker 4: The move that we made, and.
• 46:35
  Speaker 3: Broadly committee that came around came around to the view
• 46:38
  Speaker 3: that we would do the same thing we'd already done,
• 46:40
  Speaker 3: which is once we I guess in June, it was
• 46:45
  Speaker 3: at June whatever it was, we lowered the pace of QT,
• 46:49
  Speaker 3: and we're just going to do that again. We're going
• 46:51
  Speaker 3: to cut it roughly in half. And the sense of
• 46:53
  Speaker 3: that is, if you're cutting the pace of QT roughly
• 46:56
  Speaker 3: in half, then the runway is probably doubled. Okay, so
• 47:00
  Speaker 3: it's going to it's it's going to be slower for longer.
• 47:03
  Speaker 3: And people really like that. People thought, that's that's a
• 47:06
  Speaker 3: good idea. You know, it's like a plane. You can
• 47:07
  Speaker 3: think of it like a plane coming in for a
• 47:09
  Speaker 3: landing as we get closer, and by the way, we
• 47:12
  Speaker 3: still think that reserves are abundant, although you begin to
• 47:16
  Speaker 3: see some of the some of the things we look
• 47:18
  Speaker 3: at begin to react a little bit, but we still
• 47:20
  Speaker 3: think that they're abundant. Now of course, now the TGA
• 47:22
  Speaker 3: is emptying out, so reserves are higher. You can't really
• 47:26
  Speaker 3: see the underlying signal. So we came around to the
• 47:29
  Speaker 3: view and it had a lot of appeal, and so
• 47:31
  Speaker 3: we did it. It really it has no implications at
• 47:34
  Speaker 3: all for monetary policy. It has no implications at all
• 47:38
  Speaker 3: for the ultimate size of the balance sheet. It isn't
• 47:40
  Speaker 3: sending a signal in any hidden way that you can
• 47:44
  Speaker 3: try to tease out.
• 47:45
  Speaker 4: It's just not there.
• 47:46
  Speaker 3: We're basically it's very consistent with our plans and our
• 47:49
  Speaker 3: practices that we've published and that we followed since we
• 47:53
  Speaker 3: began this what is a very successful, uh you know,
• 47:57
  Speaker 3: rundown of the balance sheet again the second time that
• 48:00
  Speaker 3: we've slowed the pace, and we've said that we would
• 48:03
  Speaker 3: stop when we were somewhat above the level we judge example,
• 48:07
  Speaker 3: and clearly we're not at that level yet, but we're
• 48:08
  Speaker 3: going to be approaching it more slowly. It's a common
• 48:11
  Speaker 3: sense kind of a kind of a thing, and it
• 48:13
  Speaker 3: had it had pretty broad appeal, I will say.
• 48:16
  Speaker 11: Clear.
• 48:18
  Speaker 18: Thank you, Claire Jones Financial Times.
• 48:23
  Speaker 4: You said in January, Chair Power.
• 48:24
  Speaker 18: That inflation and expectations remained well anchored. Would you still
• 48:30
  Speaker 18: say they remain well anchored today? And just to reiterate
• 48:34
  Speaker 18: the question of the sebastic but not so well anchorerd,
• 48:38
  Speaker 18: why hasn't there been a more radical shift to the
• 48:40
  Speaker 18: policy path today? Thank you.
• 48:43
  Speaker 3: So we when we talk about inflation expectations being well anchored,
• 48:48
  Speaker 3: we're talking about longer run inflation expectations, and they really
• 48:54
  Speaker 3: haven't moved much.
• 48:55
  Speaker 4: I mean, if at all.
• 48:56
  Speaker 3: There's one reading that everyone's focusing on that it's higher,
• 49:00
  Speaker 3: but the other survey readings and the market based readings
• 49:03
  Speaker 3: all show relatively you know, well anchored inflation expectations. You
• 49:08
  Speaker 3: would expect that expectations of inflation over the course of
• 49:12
  Speaker 3: a year would move around because conditions change, and in
• 49:15
  Speaker 3: this case, we have tariffs coming in. We don't know
• 49:18
  Speaker 3: how big, what's feed there's some many things we don't know,
• 49:20
  Speaker 3: but we kind of know they're going to be tariffs
• 49:23
  Speaker 3: and they tend to bring growth down. They tend to
• 49:25
  Speaker 3: bring inflation up in the first instance. So I would say,
• 49:30
  Speaker 3: you know, I'm not dismissing what we're seeing in short
• 49:32
  Speaker 3: term inflation expectations. We as I mentioned, follow that very carefully.
• 49:37
  Speaker 3: But when we say expectations are well anchored, we're really
• 49:40
  Speaker 3: looking at you know, longer terms, five year and out,
• 49:43
  Speaker 3: and there's really no story to tell five years and out,
• 49:46
  Speaker 3: either in market based or in surveys.
• 49:50
  Speaker 4: But we will watch it.
• 49:51
  Speaker 3: I mean, we're not you know, we're not going to
• 49:53
  Speaker 3: miss any evidence that longer term or medium term inflation
• 49:57
  Speaker 3: expectations are moving.
• 50:02
  Speaker 17: Yeah.
• 50:05
  Speaker 4: By Chapel.
• 50:05
  Speaker 19: Neil Irwin with Axios. Treasury Secretary Vestin has observed that
• 50:09
  Speaker 19: a large share of job growth over the last couple
• 50:11
  Speaker 19: of years has been in what he calls government or
• 50:13
  Speaker 19: government adjacent sectors healthcare, education. Uh, do you agree that
• 50:17
  Speaker 19: there's some weakness in underlying private job growth and do
• 50:20
  Speaker 19: you see the composition of job growth as something that
• 50:22
  Speaker 19: has policy implications?
• 50:24
  Speaker 3: So that that has been the case, We talked about
• 50:26
  Speaker 3: that over the course of the last year, there were
• 50:28
  Speaker 3: there were there were some good number of months and
• 50:31
  Speaker 3: times when a lot of the job creation was was
• 50:34
  Speaker 3: concentrated in you know, educational institutions, healthcare, estate, governments, things
• 50:41
  Speaker 3: like that. There were also times when private sector job
• 50:45
  Speaker 3: growth has been moving in a healthy right.
• 50:48
  Speaker 4: I mean, they're all they're all jobs.
• 50:49
  Speaker 3: But remember we're you know, we're at very low unemployment
• 50:53
  Speaker 3: for you know, for for quite a time now. So
• 50:56
  Speaker 3: I think it's a good labor market. But it's look
• 50:58
  Speaker 3: at something that we monitor carefully. From our standpoint, employment
• 51:02
  Speaker 3: is employment. But you know, the the elected government is
• 51:06
  Speaker 3: entitled to have you know, we don't have policies that
• 51:09
  Speaker 3: address different kinds of employment, but but the elected government
• 51:13
  Speaker 3: has a different role and they can they can have
• 51:15
  Speaker 3: those pretty quick.
• 51:16
  Speaker 19: QT question, does the Committee vision at some point tapering
• 51:20
  Speaker 19: the NBS runoff runoff as well?
• 51:23
  Speaker 3: I think tapering it. I don't know, there's no plan
• 51:26
  Speaker 3: to do that. You know, at a certain point we'll
• 51:28
  Speaker 3: stop run off, and we may or may not stop
• 51:32
  Speaker 3: MBS runoff though, because you know we can, we can.
• 51:35
  Speaker 3: We get we want to stop runoff in net at
• 51:37
  Speaker 3: some point. We haven't made any decisions about that. You know,
• 51:40
  Speaker 3: we we want to want the MBS to roll off
• 51:43
  Speaker 3: our balance sheet. We really strongly desire that. So but
• 51:48
  Speaker 3: we haven't made any decisions about that. You know, we
• 51:50
  Speaker 3: we will we I think we we'd look carefully at
• 51:53
  Speaker 3: letting that keep going, but hold the overall size of
• 51:56
  Speaker 3: the balance sheet in, you know, constant at some point
• 52:00
  Speaker 3: a point that we're not out yet, all right.
• 52:01
  Speaker 1: So he's making a lot of statements here. The big
• 52:04
  Speaker 1: statement was no recession. That's probably the biggest thing. I
• 52:07
  Speaker 1: think that's also why we're seeing bitcoin on the move
• 52:11
  Speaker 1: right now.
• 52:11
  Speaker 20: Let's go back to this question we asked at the
• 52:13
  Speaker 20: same time, you could point quite a few growth risks
• 52:15
  Speaker 20: at the moment, we've seen a stock market that's gone
• 52:18
  Speaker 20: quite wobbly, rapidly cooling, housing sales plunging. Confidence surveys today
• 52:24
  Speaker 20: not only do the SEP mark down the growth outlook,
• 52:26
  Speaker 20: seventeen of nineteen seat risks to the downside. So my
• 52:30
  Speaker 20: question is how confident are you that you're well positioned
• 52:33
  Speaker 20: or is that one more thing that you're uncertain about.
• 52:36
  Speaker 3: I'm confident that we're well positioned in the sense that
• 52:39
  Speaker 3: we're well positioned to move.
• 52:41
  Speaker 4: In the direction we'll need to move.
• 52:42
  Speaker 3: I mean, I don't know anyone who has a lot
• 52:45
  Speaker 3: of confidence in their forecast. I mean, the point is
• 52:47
  Speaker 3: we are at you know, we're at a place where
• 52:51
  Speaker 3: we can cut where or we can hold what is
• 52:53
  Speaker 3: clearly a restrictive stance a policy. And that's what I mean.
• 52:57
  Speaker 3: I mean, I think that's well positioned. Forecasting right now.
• 53:01
  Speaker 3: It's you know, forecasting is always very, very hard, and
• 53:06
  Speaker 3: in the current situation, I just think it's uncertainty is
• 53:09
  Speaker 3: remarkably high.
• 53:10
  Speaker 20: And sorry, standing here today, would you be prized to
• 53:14
  Speaker 20: pivot back towards ray cuts in May?
• 53:17
  Speaker 3: I feel like I think we're not going to be
• 53:19
  Speaker 3: in any hurry to move, and as I mentioned, I
• 53:23
  Speaker 3: think we're well positioned to wait for further clarity and
• 53:28
  Speaker 3: not in any hurry.
• 53:31
  Speaker 9: Matt com Menny with us CNN.
• 53:35
  Speaker 4: Thank you, Chapale.
• 53:37
  Speaker 14: The FED statement released today remove the line that previously
• 53:41
  Speaker 14: said the Committee judges at the risk to achieving its
• 53:44
  Speaker 14: employment and inflation goals are roughly in balance. Can you
• 53:48
  Speaker 14: explain the decision to remove that line. Does it mean
• 53:51
  Speaker 14: that you're now more concerned about inflation or about employment?
• 53:56
  Speaker 4: Actually does not mean either of those things.
• 53:58
  Speaker 3: You know, some times with language, they it lives, it's
• 54:03
  Speaker 3: useful life, and then we.
• 54:06
  Speaker 4: Take it off.
• 54:06
  Speaker 3: And that was the case there there's really not meant
• 54:09
  Speaker 3: to be any signal here. Over the past year, you know,
• 54:14
  Speaker 3: conveying the sense of the balance of risks was important,
• 54:17
  Speaker 3: that they be in balanced or close to being in balance.
• 54:19
  Speaker 3: That was useful as we approached liftoff, if you remember.
• 54:23
  Speaker 3: But we're past that. I'm sorry now beginning beginning to cut.
• 54:27
  Speaker 3: So we just we just took it out. I actually
• 54:29
  Speaker 3: would say that the more important thing now about risks,
• 54:33
  Speaker 3: and this is in the pages like ten eleven, twelve
• 54:36
  Speaker 3: of the SEP. If you look, participants widely raised their
• 54:41
  Speaker 3: estimate of the risks to our uncertainty, but also of
• 54:46
  Speaker 3: the risks to growth and our employment and inflation mandates.
• 54:51
  Speaker 3: That's that's a more salient point now than whether they're
• 54:54
  Speaker 3: whether they're in balance.
• 54:56
  Speaker 14: Just on the stock market, the stock markets obviously declined
• 54:59
  Speaker 14: significant least since the FED last met. Are you concerned
• 55:03
  Speaker 14: at all about some of the market volatility having a
• 55:06
  Speaker 14: real economic impact in terms of hurting business spending or
• 55:10
  Speaker 14: consumer spending, especially among higher income households.
• 55:15
  Speaker 3: So financial conditions matter to us because you know, financial
• 55:18
  Speaker 3: conditions are the main channel to the real economy through
• 55:20
  Speaker 3: which our policy has its effects. So they're important But
• 55:24
  Speaker 3: what matters from a FED standpoint for the macro economy
• 55:28
  Speaker 3: is material changes to overall financial conditions that are persistent
• 55:33
  Speaker 3: that lasts for a while long enough to actually affect
• 55:36
  Speaker 3: affect economic activity.
• 55:37
  Speaker 4: So that's what we're looking for.
• 55:39
  Speaker 3: I'm not going to appine on the appropriate level of
• 55:43
  Speaker 3: any market equity, debt, commodities or anything like that, and
• 55:48
  Speaker 3: I would just point you to the bigger picture again,
• 55:51
  Speaker 3: you know, the real economy that the hard data are
• 55:53
  Speaker 3: still in reasonably good shape.
• 55:55
  Speaker 4: It's the soft data.
• 55:57
  Speaker 3: It's the surveys that are showing, you know, significant concerns,
• 56:01
  Speaker 3: downside risks and those kind of things.
• 56:03
  Speaker 4: We don't dismiss that.
• 56:04
  Speaker 3: We're watching it carefully, but you know, we don't want
• 56:07
  Speaker 3: to get ahead of that. You know, we want to
• 56:09
  Speaker 3: focus on the hard data.
• 56:10
  Speaker 15: This.
• 56:10
  Speaker 3: If it's if that's going to affect the hard data,
• 56:14
  Speaker 3: we should know it very quickly. And of course we'll
• 56:16
  Speaker 3: understand that, but you don't see that yet.
• 56:20
  Speaker 4: Jenni Birth, thank.
• 56:24
  Speaker 21: You to your pal, Jennifer Schawenberger with Yahoo Finance. As
• 56:27
  Speaker 21: you look to navigate higher inflation and lower growth, the
• 56:31
  Speaker 21: FED has talked about heeding the lessons from the nineteen seventies.
• 56:35
  Speaker 21: Is the FED willing to have a recession if it
• 56:37
  Speaker 21: means breaking the back of inflation.
• 56:41
  Speaker 3: Well, fortunately, we're in a situation where we have seen
• 56:47
  Speaker 3: inflation move down from you know, higher levels to pretty
• 56:51
  Speaker 3: close to two percent, while the unemployment rate has remained
• 56:56
  Speaker 3: very consistent with full employment four point one percent. So
• 56:59
  Speaker 3: we now have inflation coming in from an exogenous source.
• 57:02
  Speaker 3: But the underlying inflationary picture before that was you know,
• 57:06
  Speaker 3: basically two and a half percent inflation I would say,
• 57:08
  Speaker 3: and two percent growth and four percent on a ployment.
• 57:12
  Speaker 3: So that's that's what we did. That's what together the
• 57:16
  Speaker 3: economy accomplished. So I don't see any reason to think
• 57:20
  Speaker 3: that we're looking at a replay of the seventies or
• 57:22
  Speaker 3: anything like that. You know, inflation, underlying inflation is you know,
• 57:26
  Speaker 3: still running in the twos with probably a little bit
• 57:29
  Speaker 3: of a pickup associated with tariffs.
• 57:32
  Speaker 4: So I don't think we're facing.
• 57:34
  Speaker 3: I wouldn't say we're in a situation that's remotely comparable
• 57:38
  Speaker 3: to that.
• 57:39
  Speaker 21: And last month, the idea of a DOGE dividend was proposed,
• 57:42
  Speaker 21: which would send five thousand dollars checks to every taxpayer
• 57:45
  Speaker 21: from DOGE savings. President Trump and Elon Musk have supported this.
• 57:49
  Speaker 21: There's reports there could be a bill introduced from Capital
• 57:52
  Speaker 21: Hell what impact might that have on household savings and
• 57:56
  Speaker 21: spending in terms of your growth and out look for
• 58:00
  Speaker 21: you know.
• 58:01
  Speaker 3: It's it's not appropriate for me to speculate on political
• 58:05
  Speaker 3: ideas or physcal policy for that matter.
• 58:07
  Speaker 4: So I'm gonna I'm gonna pass on that one. Thank you.
• 58:09
  Speaker 22: Yeah, Hi, jap out Daniel Davis from as France Press.
• 58:16
  Speaker 22: You mentioned that tariffs are already having at least some
• 58:19
  Speaker 22: impact on inflation. I'm just wondering how you and your
• 58:21
  Speaker 22: colleagues on the FMC have been thinking about the possibility
• 58:24
  Speaker 22: of retaliatory tariffs from other countries, especially with April the
• 58:27
  Speaker 22: second coming up. Was it something you considered during this meeting?
• 58:30
  Speaker 3: Thanks, So since the very beginning, we've had kind of
• 58:33
  Speaker 3: a placeholder. The staff has a placeholder of range of
• 58:39
  Speaker 3: really a range of possible outcomes from from tariffs and
• 58:42
  Speaker 3: from trade policy generally, and they generally assume full retaliation
• 58:45
  Speaker 3: in those and so that's that's kind of baked into
• 58:47
  Speaker 3: the numbers. What happens, it will be complicated and there
• 58:51
  Speaker 3: will be some retaliation and some not and all that,
• 58:54
  Speaker 3: but ultimately they're trying to with the placeholder give us
• 58:57
  Speaker 3: a broad sense of what this might look like this
• 59:01
  Speaker 3: when we know, when we actually know the specifics, we'll
• 59:03
  Speaker 3: be able to have still uncertain but you know, better
• 59:06
  Speaker 3: informed forecasts.
• 59:08
  Speaker 4: So yes, that's in there.
• 59:11
  Speaker 1: Last question goes to gene.
• 59:15
  Speaker 16: Hi chair Palal gene Young with M and I Market
• 59:18
  Speaker 16: Use had a couple questions on the balance sheet change
• 59:22
  Speaker 16: that you made. So the Minutes had initially described your
• 59:25
  Speaker 16: discussion on slowing QT as temporary until the debt ceiling
• 59:29
  Speaker 16: is resolved. But from what you said earlier, doesn't sound
• 59:32
  Speaker 16: like there's a desire to kind of regain the pace
• 59:35
  Speaker 16: of QT that we have at the moment after the
• 59:39
  Speaker 16: debt ceiling is resolved.
• 59:40
  Speaker 4: Is that the case?
• 59:42
  Speaker 3: Yeah, So we looked at pausing and we looked at slowing,
• 59:46
  Speaker 3: and really people came together very strongly behind slowing not
• 59:49
  Speaker 3: pausing for a variety of reasons. And so people really
• 59:52
  Speaker 3: came to be, you know, pretty strongly in favor of
• 59:55
  Speaker 3: this move slows down the path and probably lengthened that,
• 1:00:00
  Speaker 3: you know, doubles it effectively by slowing the by half.
• 1:00:03
  Speaker 3: That's that's that people thought that's that's a good place
• 1:00:06
  Speaker 3: to be. It'll it'll, you know, help us assure that
• 1:00:10
  Speaker 3: this path is a smooth one.
• 1:00:12
  Speaker 4: As we get closer and closer to that. So that's
• 1:00:14
  Speaker 4: how that came about.
• 1:00:15
  Speaker 16: I guess my question is more, was that meant to
• 1:00:18
  Speaker 16: be a temporary measure during the debt ceiling episode.
• 1:00:20
  Speaker 3: Or you know it was it was actually it was
• 1:00:23
  Speaker 3: the the TGA flows Treasury General Account flows that got
• 1:00:26
  Speaker 3: us thinking about this. But the more we thought about it,
• 1:00:28
  Speaker 3: we came around to this and and you know.
• 1:00:31
  Speaker 4: It is, Yes, it was provoked.
• 1:00:33
  Speaker 3: The original discussion was provoked by that, but I think
• 1:00:36
  Speaker 3: what we came up with though, was broader than that
• 1:00:38
  Speaker 3: and different than it does address that issue, but it
• 1:00:41
  Speaker 3: really is Also it fits in really nicely with our
• 1:00:45
  Speaker 3: principles and our plans and the things we've done before
• 1:00:47
  Speaker 3: and the things we said we would do.
• 1:00:49
  Speaker 4: So that's why, you know, pretty pretty strong support.
• 1:00:52
  Speaker 3: I'd just say it's it's nothing to do with monetary policy,
• 1:00:55
  Speaker 3: nothing to do with the size of the balance sheet.
• 1:00:57
  Speaker 4: It's just kind of a common sense adjustment.
• 1:00:59
  Speaker 3: As you get closer and closer, let's slow down a
• 1:01:02
  Speaker 3: little bit again, and that way we'll be more and
• 1:01:04
  Speaker 3: more confident that we're getting where we need to get.
• 1:01:07
  Speaker 4: You can take our time getting there.
• 1:01:08
  Speaker 3: You know, we're shrinking the balance sheet every month, and
• 1:01:11
  Speaker 3: we think that's we think it was a good play.
• 1:01:13
  Speaker 4: And as I mentioned, well supported. Thanks very much.
• 1:01:19
  Speaker 1: All right, So there's chair pal big takeaways from today,
• 1:01:22
  Speaker 1: and of course I think you guys can see that
• 1:01:24
  Speaker 1: here in the bitcoin chart, which really if you look
• 1:01:27
  Speaker 1: at this coming in from about an hour running right now,
• 1:01:31
  Speaker 1: bitcoin has come up quite a bit, which is where
• 1:01:34
  Speaker 1: it's holding right now at eighty five. Now, granted, this
• 1:01:36
  Speaker 1: is still a very reactionary situation that plays out when
• 1:01:41
  Speaker 1: these FOMC meetings going on. But the big takeaways no recession.
• 1:01:45
  Speaker 1: I think he is clear that he does not believe
• 1:01:48
  Speaker 1: a recession is necessarily going to happen, mainly because of
• 1:01:51
  Speaker 1: what they've been able to see in terms of the
• 1:01:54
  Speaker 1: structure under the inflation control that they've been able to implement.
• 1:01:58
  Speaker 1: The question though, that I think leaves for the entire
• 1:02:02
  Speaker 1: market is how these tariffs are going to play out,
• 1:02:05
  Speaker 1: And I think he is and he must have said
• 1:02:06
  Speaker 1: this ten times, is the uncertainty of the market. The
• 1:02:10
  Speaker 1: uncertainty is a big factor because this is what drives
• 1:02:13
  Speaker 1: businesses to invest investors to go in and buy a
• 1:02:17
  Speaker 1: dip instead of setting on the sideline with these you know,
• 1:02:20
  Speaker 1: these M two rising coffers and basically cash on the sidelines.
• 1:02:25
  Speaker 1: And then the other thing that I think he continues
• 1:02:27
  Speaker 1: to hit on is this resiliency of the economy. And
• 1:02:32
  Speaker 1: granted though there are a lot of macro pressures, I'm
• 1:02:35
  Speaker 1: not sure where he's seeing that other than on the
• 1:02:37
  Speaker 1: top side. I and we've seen more come off the
• 1:02:40
  Speaker 1: FO or the S and P five hundred just in
• 1:02:42
  Speaker 1: the last three weeks than what we've seen in the
• 1:02:46
  Speaker 1: last almost eighteen months. So I think the thing is
• 1:02:50
  Speaker 1: playing out right now, maybe to the point of where
• 1:02:54
  Speaker 1: the Fed wants it, even though I just feel like
• 1:02:57
  Speaker 1: May has got to be the day because if tariffs
• 1:02:59
  Speaker 1: do go into effect in April, which we'll know here
• 1:03:03
  Speaker 1: in a couple of weeks, if Trump is going to
• 1:03:06
  Speaker 1: hold the line if that occurs, I think the pressure
• 1:03:09
  Speaker 1: will be undeniable going into it. So April is going
• 1:03:13
  Speaker 1: to be a very critical month. Guys, make sure and
• 1:03:17
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• 1:03:19
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• 1:03:23
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