Federal Reserve officials entered the new year divided over how much to lower interest rates after cutting them during their last three meetings of 2025. A growing number, mainly the presidents of the regional Federal Reserve banks, have come out in favor of holding rates steady, at least until they have more data on inflation and jobs from post-shutdown monthly reports. Not Fed Governor Stephen Miran. The temporary appointee of President Donald Trump said he wanted to see rates slashed by at least 100 ...

At the end of that speech at Columbia, you nodded to the fact that recessions are inevitable. Fed's job It's going to forestall them as much as they can. Policymakers, jobs or that.I'm very curious when you look at the labor market in particular, the rise that we've seen in the unemployment rate, that's kind of rise we've seen customarily before recessions. How do you assess the risk of there being a recession here in the near term when you look at the labor market, for instance. So I don't see a recession ...

Key TakeawaysFederal Reserve Governor Stephen Miran is advocating for aggressive interest rate cuts, proposing the federal funds rate be halved to 2% to avert a recession, a stance that diverges significantly from other Fed policymakers.Asset manager Janus Henderson Group plc (JHG) has agreed to be acquired by Trian Fund Management and General Catalyst in an all-cash transaction valued at approximately $7.4 billion, offering shareholders $49.00 per share.The CBOE Volatility Index (VIX), a key gauge of marke ...

>> WHY DON'T WE GET OVER TO STEVE LIESMAN. HE'S GOT A VERY SPECIAL GUEST THIS MORNING. A SPECIAL INTERVIEW WITH NEW YORK FED PRESIDENT JOHN WILLIAMS.STEVE. >> ANDREW. THANK YOU.YES, I AM HERE AT THE NEW YORK FED WHERE I'VE BEEN. WE DON'T KNOW HOW MANY YEARS IN A ROW NOW, BUT SEVERAL WITH PRESIDENT JOHN WILLIAMS FOR A TRADITIONAL DECEMBER HOLIDAY INTERVIEW. WELL, WELCOME BACK, STEVE.THANKS. AND JOHN, I WAS JUST REMARKING ABOUT HOW GREAT OUR TEAMS ARE WHO SCHEDULED THIS MONTHS IN ADVANCE, KNEW THERE WOULD BE ...

>> WHY DON'T WE GET OVER TO STEVE LIESMAN. HE'S GOT A VERY SPECIAL GUEST THIS MORNING. A SPECIAL INTERVIEW WITH NEW YORK FED PRESIDENT JOHN WILLIAMS.STEVE. >> ANDREW. THANK YOU.YES, I AM HERE AT THE NEW YORK FED WHERE I'VE BEEN. WE DON'T KNOW HOW MANY YEARS IN A ROW NOW, BUT SEVERAL WITH PRESIDENT JOHN WILLIAMS FOR A TRADITIONAL DECEMBER HOLIDAY INTERVIEW. WELL, WELCOME BACK, STEVE.THANKS. AND JOHN, I WAS JUST REMARKING ABOUT HOW GREAT OUR TEAMS ARE WHO SCHEDULED THIS MONTHS IN ADVANCE, KNEW THERE WOULD BE ...

So this has come up a couple of times today, but to be clear, do you believe that we're experiencing a positive productivity shock whether from AI or policy factors or whatever. Uh and how much of that is how much is that driving the higher GDP projection in the SCP. >> So yeah, I mean it uh [clears throat] I never thought I would see a time when we had, you know, five, six years of 2% productivity growth.This is this is higher, you know, this is definitely higher and it was it was before before it could be ...

Economic Growth and Investment - The economy is performing well, with second-quarter growth at 8%, and a forecast of 3.5% to 4% growth for the third quarter [2][3] - There is a significant capital expenditure (capex) boom driven by policies that allow full expensing, contributing to a building boom [3][9] - Investment spending is at a multi-decade high, which is expected to enhance the economy's supply-side potential [9] Interest Rates and Monetary Policy - The neutral interest rate is likely lower than market expectations, suggesting that rates should be lower to stimulate economic activity [1] - High interest rates are currently impacting the economy, but there are concerns that cutting rates too much could lead to excessive debt issuance and potential market bubbles, particularly in AI [4][5] - The yield curve remains flat, indicating that inflation expectations are well-anchored, and a capex boom could be disinflationary [6] Inflation and Wages - Inflation is primarily seen in services, with expectations that prices will decrease due to falling rents and increased housing supply [5][6] - Real blue-collar wages have increased by 1% in the first nine months of the year, marking one of the strongest performances for any new administration [12] - Policies such as the working families tax cut are expected to raise wages through capital investment, which will help address cost of living issues [10][12]

(Bloomberg) — After cutting interest rates by more than a percentage point, Federal Reserve officials are now wondering where to stop – and finding there’s more disagreement than ever. In the past year or so, prescriptions for where rates should end up have diverged by the most since at least 2012, when US central bankers started publishing their estimates. That’s feeding into an unusually public split over whether to deliver another cut next week, and what comes after that. Most Read from Bloomberg Fed ...

Core Viewpoint - The Federal Reserve's current monetary policy is considered too restrictive, with a neutral rate that is believed to be significantly lower than the current policy stance [1][2][14]. Group 1: Monetary Policy and Economic Outlook - The argument for maintaining a less restrictive policy is based on a more optimistic view of inflation compared to other committee members, suggesting that prolonged restrictive policies could lead to an economic downturn [2][16]. - The concept of "passive tightening" is introduced, indicating that as neutral rates shift, the existing policy can become tighter without any active changes [14][15]. - The discussion highlights that financial market conditions may appear easier, but this does not necessarily reflect the true stance of monetary policy, as various factors influence market dynamics [4][7][8]. Group 2: Financial Conditions and Market Dynamics - Financial conditions affecting housing and private credit markets are noted to be tighter, contrasting with the perception of easier conditions in stock markets [8][31]. - The impact of alternative data on the labor market is acknowledged, suggesting that it indicates a decline in demand, which aligns with the view that current policy is too tight [28][30]. - Concerns are raised about the potential for unrecognized distress in private markets, which could signal broader issues related to the restrictive stance of monetary policy [31][33].

Monetary Policy Stance - The Fed is considered too restrictive, with neutral rates significantly below current policy [1] - Maintaining a restrictive policy for an extended period risks causing an economic downturn [2][16] - Financial markets are influenced by various factors beyond monetary policy, including technological advancements [4][5] - It's a mistake to automatically infer the stance of monetary policy solely from financial conditions [7] - Housing market conditions are tighter and have a greater impact on the economy's cyclical position than the stock market or credit spreads [8] - Policy passively tightened through 2025 due to shocks driven by economic policies outside the Fed, pushing neutral rates higher last year and lower this year [9][10][14] Neutral Rate and Economic Factors - Population growth rate is a major driver of neutral rates, experiencing 30 years' worth of change in only three years [11][12][13] - Changes in neutral rate accelerate over time, impacting the stance of monetary policy [14][15] Data Dependency and Economic Forecasts - Being excessively data-dependent makes the analysis backward-looking; forecasts should be prioritized [23] - Confidence in forecasts is high due to known shocks like population growth, minimizing the need for data dependency [24] - Alternative data on the labor market indicates a continual ebbing of demand, signaling that policy is too tight [27][28] Private Credit Market - Distresses in private markets suggest financial conditions have been tighter than perceived [9][31] - Uncorrelated credit problems can indicate a restrictive monetary policy [33][34]