Jerome Powell’s Jackson Hole speech sent stocks into a tailspin on Friday, and several Fed officials are speaking publicly this week. 🎤
So the big question is, will they deliver the same messaging as Powell did last week?
Today, Bloomberg interviewed Federal Reserve Bank of Minneapolis President Neel Kashkari, who didn’t mince words. 💬
Conor Sen has a tweet thread with his thoughts on the article, but in essence, Kashkari said that he was happy to see the stock market sell-off on Friday.
Kashkari not holding back: pic.twitter.com/k0rZQIHqdU
— Conor Sen (@conorsen) August 29, 2022
His view is that the market was rallying in anticipation of a Fed pivot towards a ‘looser policy’ that isn’t coming. So the fact that stocks are selling off means investors may be finally accepting that the Fed will stay aggressive until inflation shows meaningful progress towards the 2% goal.
We’ll have to see if the other Fed members use the explicit language that Powell and Kashkari have. If they do, that might not be great for stocks in the short-term, but clearer messaging on the Fed’s next moves could prove to be a longer-term net positive. 🤷♂️