Wall Street Breakfast Fed in a big hurry to do nothing
9 snips
May 7, 2025 The Federal Reserve's decision to hold interest rates raises eyebrows amidst stagflation worries. Chairman Powell indicates patience as they await the impact of tariffs. Meanwhile, the White House is poised to eliminate the AI diffusion rule. Exciting news for Disney fans as the company unveils plans for a theme park in Abu Dhabi. This episode also delves into how semiconductor trade news could sway stock performance for major players like Disney and NVIDIA.
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Fed Highlights Stagflation Risk
- The Fed warned about rising risks of both higher unemployment and inflation, suggesting stagflation concerns.
- This dual threat poses a complex problem that monetary policy alone cannot solve.
Powell Advocates Patience on Tariffs
- Fed Chair Powell emphasized patience, advising to wait and observe tariff impacts before making moves.
- The market's main message is cautious watching due to significant uncertainty around tariffs.
Supply Issues Limit Fed Actions
- Powell noted supply disruption from tariffs can't be fixed by monetary policy, only worsened by adjusting demand.
- Using demand control to tackle supply chain issues would be ineffective and counterproductive.