Marketplace All-in-One What's next for the Fed?
Dec 4, 2025
This conversation features Sabree Beneshore, a Marketplace reporter focused on bond market reactions; Kristen Schwab, who highlights families grappling with rising child care costs; and Andrea Eisfeltz, a UCLA finance professor discussing labor market trends. They explore the critical importance of Fed independence amid potential shifts in leadership. The discussion also dives into how delayed data impacts economic decisions, the implications of rising inflation on bond markets, and the tough choices families face regarding employment and childcare.
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Why Fed Independence Matters
- Fed independence matters because political pressure to keep rates low can let inflation run unchecked.
- History shows politicized central banks triggered the high inflation of the late 1970s and painful tightening under Paul Volcker.
How Inflation Haunts Bonds And Markets
- Rising inflation expectations force long-term bond yields up, making borrowing more expensive across the economy.
- That effect squeezes equities and credit and leaves few safe havens for investors.
Prepare For A Likely Fed Rate Cut
- Expect the Fed to cut the federal funds rate by a quarter point at its upcoming meeting.
- Monitor who the White House names as the next Fed chair because their stance could push rates lower or force market volatility.
