- My expectation is the task forces will begin work ‘in the next couple weeks’
- Most or all will conclude by year end
The ‘no reason’ comment is hawkish.
More:
- Inflation is primarily determined by monetary policy
- We have the capability to deliver on 2% and that’s exactly what we’re going to do
- Can’t provide forward guidance, we will meet again in six weeks
- Policy on housing appears somewhat restrictive, but I would have a hard time saying that about financial markets
- Policymakers don’t feel bound by dots
- Pretty open minded about communications
- Colleagues have been very open about changes
Kevin Warsh
Importantly, he repeatedly talked about delivering on the Fed’s mandate and immediately highlighting the part on price stability and not mentioning the employment side of the mandate.
“Fed statement says that inflation is primarily determined by monetary policy. You bet it is. I’ve said for years inflation is a choice. You bet it is.”
“We’ve missed on inflation for five years and we’re going to fix that”
- Criticizes survey data statistics
- Markets react best when they react to incoming info, not ‘how will the Fed react’
- The Fed’s job is to ensure no second-round price effects
- We have work to do on the price stability front
- I don’t believe we have a cruel choice to make on full employment and stable prices
This is all very hawkish in my view. It might take awhile for markets to realize that this is still the 2010 Warsh who was a total hawk.
