Adam Posen Thinks Things Could Get 'Messy' for the Fed | Odd Lots

Kevin Warsh gave a hawkish speech at this year's annual Kansas City Fed Symposium in Jackson Hole, but that doesn't mean the challenges are over. Will the Fed actually pull the trigger on rate hikes? What happens if the central bank doesn't act quickly enough to curb inflation? And how exactly will the new chair leave his mark on the Fed? We speak with Adam Posen, president of the Peterson Institute for International Economics, who gives us his take on the direction of monetary policy and grades Warsh's speech. We also discuss why high inflation in the US is different than other countries, how the Treasury's wading into the bond market affects Fed independence, which of the Fed task forces might be the most impactful, the "messy jobs" theory of AI, and what Warsh really means when he says he wants the FOMC to have a “good family fight.”

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Chapters:
00:00:00 - Debate Culture at the Fed: "Family Fight" and the Powell Consensus
00:00:45 - Introduction: Adam Posen, Peterson Institute
00:02:16 - Assessment of Chair Warsh's Jackson Hole Speech
00:07:37 - Warsh's Preference for Last-Minute Discretion
00:10:24 - The Role of the Fed Chair and Committee Dynamics
00:13:17 - Was the Fed's Inflation Record Powell's Fault?
00:17:06 - Political Interference with the Fed and Fiscal Dominance
00:20:16 - Debate Culture at the Fed: "Family Fight" and the Powell Consensus
00:23:56 - The Fed Communications Task Force
00:30:15 - Economists Moving to AI Companies
00:36:08 - AI's Current Economic Impact: Productivity vs. Labor Market
00:44:47 - GDP Mismeasurement and AI's Contribution
00:51:18 - Inflation Outlook and Rate Hike Expectations
00:54:23 - Final Thoughts
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Bloomberg's Joe Weisenthal and Tracy Alloway analyze the weird patterns, the complex issues and the newest market crazes. Join the conversation every Monday and Thursday for interviews with the most interesting minds in finance, economics and markets.

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