Monetary Matters with Jack Farley Fed Scared of Inflation Resurgence | Jack Farley & Max Wiethe
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Jun 18, 2025 Jack Farley and Max Wiethe dive into the Federal Reserve's latest decision, highlighting fears over inflation and GDP forecasts. They explore how current market dynamics echo late 2021, with intriguing debates on whether AI constitutes a bubble. The discussion also transitions to tourism trends observed in Greece, illustrating broader economic shifts. Stock valuations, especially within tech giants like Microsoft and NVIDIA, spark conversations about high multiples and future growth. Join them as they navigate the complexities of economic indicators and tech stock trends.
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Fed's Mixed Economic Projections
- The Fed's Summary of Economic Projections shows a contradictory mix: higher inflation expectations, lower GDP expectations, and marginally higher interest rates.
- This cocktail signals a cautious or hawkish stance that is not positive for the economy or risk assets.
Fed Shifts to Forward-Looking Stance
- The Fed remains "data dependent" but is now also "forward looking," adjusting its stance based on expected inflation effects from tariffs.
- This shift means the Fed might be less dovish despite disinflation, signaling caution about future inflation pressures.
Markets Expect Fed Easing Despite Hawkish Dots
- Market pricing shows skepticism about the Fed's hawkish dot plot and anticipates easing instead.
- Investors may believe tariffs will contract demand, leading to slower growth and easing pressures.