Financier and lawyer Kevin Warsh was confirmed as chair of the Federal Reserve by the U.S. Senate on May 13 and officially took his position on May 15. The Fed’s dual mandate from Congress is promoting maximum employment and stable prices (i.e., controlling inflation). Warsh’s first meeting of the Federal Open Market Committee (FOMC), the Read more
Inflation
Economic Outlook: Fallout from the Iran War
Markets continue to react to minute-by-minute developments regarding the ongoing U.S./Israeli war with Iran, which has effectively closed the Strait of Hormuz, narrow, strategic waterway in the Persian Gulf through which roughly 20% of the world’s oil and liquid natural gas pass, as well as affecting the global supply of helium, fertilizer, and aluminum. The Read more
Horns of a Dilemma: Is Stagflation on Its Way?
As the effect of the Trump administration’s fluctuating tariff policies have heightened uncertainty for consumers and the markets, economists have begun to worry about the looming risk of stagflation, an economic condition not seen in the United States since the 1970s. Though the U.S. economy is still in a “strong position” according to the Federal Read more
A Shear Guessing Game: Will the Fed Cut Rates?
The Federal Reserve’s battle against inflation had gone better than expected until it recently got bogged down. Thus, the effort to combat inflation can’t be called a victory just yet. Though the initial predictions for Fed rate cuts for 2024 ranged from three to six, expectations have shifted dramatically with the market now pricing in Read more
How Inflation is Measured
Inflation has been much in the news during the last few years, with notice of whether the rate is up or down a staple of reports. Inflation is the rate of increase in prices over a given period of time. (Historically, prices have rarely decreased; one example of such deflation would be the Great Depression Read more
When Not If: Economic Data and The Fed’s Rate Cut(s)
The Federal Reserve increased rate in 2022 and 2023 as the central bank sought to contain surging inflation. Now, in 2024, with price pressures easing and the economy still strong, Fed officials are poised to bring rates down at a slower pace. Because the Fed’s benchmark rate influences lending costs for mortgages, cars, and credit Read more