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Unusual Whales Pod #11: 2.6% GDP, the American economy at large, and risks in the Treasury market

Unusual Whales

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Is the Fed Really Overshooting?

The Fed is well aware of the policy lags and it talks about them, but it's actually kind of counting on them. It wants to overshoot. So they kind of are erring on the side of overshooting by design rather than by accident. And as Bob mentioned earlier, we're at a different state than we were before. Balance sheets and everything are much stronger. That all argues for this taking longer. Unless something breaks and then we have the financial crisis channel.

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