With the Fed set to hike interest rates yet again, Jack is lucky to speak to the ultimate Federal Reserve heavyweights: Nick Timiraos, chief economics corresopndent for The Wall Street Journal, and Joseph Wang, former senior trader for the New York Fed. Timiraos and Wang share what they will be watching for in the Powell presser on November 2nd, 2022, and discuss how resilient consumer balance sheets are making the Fed’s job even harder. Timiraos
Wang argues that Treasury buyback program would be effective in improving liquidity in U.S. government bonds, which is currently very weak, and Timiraos shares how he goes about picking a question to ask Fed Chair Jerome Powell.
Filmed on November 1, 2022, the first day of the meeting of the November Federal Open Market Committee. Stay tuned for an upcoming interview with Joseph Wang and Jim Bianco, which will be filmed after the Powell presser on November 2nd.
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Joseph Wang’s book, “Central Banking 101”: https://www.amazon.com/Central-Banking-101-Joseph-Wang/dp/0999136747
Nick Timiraos’ book, “Trillion Dollar Triage: How Jay Powell And The Fed Battled A President And A Pandemic – And Prevented Economic Disaster”: https://www.littlebrown.com/titles/nick-timiraos/trillion-dollar-triage/9780316272810/
Nick Timiraos’ article: “Fed Meeting to Focus on Interest Rates’ Coming Path”: https://www.wsj.com/articles/fed-meeting-to-focus-on-interest-rates-coming-path-11667295181
Nick Timiraos’ article: “Cash-Rich Consumers Could Mean Higher Interest Rates for Longer”: https://www.wsj.com/articles/cash-rich-consumers-could-mean-higher-interest-rates-for-longer-11667075614
Joseph’s Wang piece, “The Money Still Flows”: https://fedguy.com/the-money-still-flows/
Joseph Wang’s piece on Treasury Buybacks (“Quantitative Buybacks”): https://fedguy.com/quantitative-buybacks/
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Timestamps:
(00:00) Intro
(01:07) What To Look For In November FOMC Meeting
(11:06) The Consumer Balance Sheet Is Strong
(19:45) The Fed's Balance Sheet
(28:45 )Treasury Liquidity Is Very Weak"
(31:20) A Potential Treasury Buyback
(31:51) Will The Fed Adjust Its Inflation Target?
(46:37) Could The Fed Go From A 50 Basis Point Hike To A Halt In Hiking Rates?
(49:36) Asking A Question To Jerome Powell
(56:43 )Is The Drain on Banking Reserves Going To Force The Fed To Stop Reducing Its Balance Sheet?
Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.
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Forward Guidance