Earlier this week, the market heard from Boston Fed chief Eric Rosengren, one of two dissents at the July Fed meeting, which of course brought us the first rate cut in a decade.
Suffice to say Rosengren did not strike a conciliatory tone while speaking to Bloomberg’s Kathleen Hays.
“I just want to see evidence that we’re actually going into something that’s more of a slowdown”, he said, adding that “just because other countries are weak, if we’re strong it doesn’t mean we should [cut rates]”.
Read more: Boston Fed Chief Eric Rosengren Is A Man Suffering From A ‘Horrendous Lack Of Vision’
Long story short, Rosengren sounds as though he’s likely to dissent again next month.
Well, on Thursday, the market heard from the other dissenting vote at the July FOMC, Esther George.
As usual, she adopted a measured, deliberate tone in a chat with CNBC’s Steve Liesman. Here’s Esther:
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“My sense was we’ve added accommodation and it wasn’t required, in my view”, George said of the July cut.
Suffice to say she isn’t likely to believe it’s “required” now either, given recent data which continues to paint a picture of a resilient consumer.
That said, George did express palpable concern about the trade war and indicated that she, like the rest of the Fed, doesn’t expect the Sino-US tensions to abate soon.
Meanwhile, Donald Trump attacked the Fed again on Thursday morning. “Our Federal Reserve does not allow us to do what we must do. They put us at a disadvantage against our competition”, the president said. “Fight or go home!”
Exactly one year ago today, in Jackson Hole, Liesman asked George if Trump’s attacks on the central bank influenced her decisions.
Her response was as unequivocal as it was dismissive: “No”.
“Our Federal Reserve does not allow us to do what we must do. They put us at a disadvantage against our competition”, the president said. “Fight or go home!”
Doesn’t this say it all about Trump’s stance regarding world trade? We don’t have trading partners……we have competitors.
Trump’s mantra is “Win, win, win.” Truth be told, it’s not about winning: he demands to crush all opponents. It’s why we can’t have allies or trading partners. Think about his attitude toward Obama and McCain. He will not be satisfied until their memories are banished from the earth. It’s why he loves dictators – they crush people.
I’ve seen a few people like this in a variety of settings. They always leave a wake of destruction.
Obama and McCain’s memory will not be forgotten. They will be remembered with respect. Trump will also not be forgotten, but will be remembered as the worst example of what a president of the USA should be.
So what’s the over/under on Fed action/Jackson Hole? Is it fair to think that, given consensus for 75bp cut through Dec, stocks will be disappointed should Powell not signal obeisance to Trump?