Central bankers set policy with incomplete information, unobservable targets, and constant trade-offs between growth, inflation, and employment. In this episode, we delve into how the fight for Federal Reserve independence could impact markets, interest rates, and your financial future.
Topics covered include:
- What Federal Reserve Chair Powell said at the Fed's annual Jackson Hole Symposium
- What is the Federal Reserve's mission statement
- Why is it normal for U.S. presidents to disagree with the Federal Reserve's policy stance?
- Why attacking the Fed's independence is harmful and could lead to higher interest rates and a weakening dollar
- What causes inflation, and why is it difficult to know the correct level of interest rates
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Show Notes
2025 Statement on Longer-Run Goals and Monetary Policy Strategy—The Federal Reserve Board
Trump says U.S. interest rate is at least 3 points too high—Reuters
Trump warns of economic slowdown unless Fed cuts rates, triggering selloff by Howard Schneider and Ismail Shakil—Reuters
What is the neutral rate of interest? by Sam Boocker, Michael Ng, and David Wessel—Brookings
Trump Moves to Fire Fed’s Cook, Setting Up Historic Fight by Jonnelle Marte and Myles Miller—Bloomberg
Different Types of Central Bank Insolvency and the Central Role of Seignorage by R. Reis—Semantic Scholar
Powell's Econ 101: Jobs not inflation. And forget about the money supply by Howard Schneider—Reuters
Related Episodes
453: The Price of Money – 700 Years of Falling, Can Interest Rates Keep Rising?
312: What the Federal Reserve’s New Policies Mean For Your Finances
295: Federal Reserve Insolvency and Monetizing the National Debt
246: What Central Banks Don’t Know Should Concern You
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