Peter's Blog

Federal Reserve Chairman Kevin Warsh used his Jackson Hole podium on Friday to draw a bright line around the central bank’s credibility, declaring that the long-promised 2 percent inflation goal on the Personal Consumption Expenditures (PCE) index is “a firm, fixed target.” Price stability, he said, “is not self-executing…it’s the Fed’s job to deliver stable […]

Money Supply is a very important indicator. It helps show how tight or loose current monetary conditions are regardless of what the Fed is doing with interest rates. Even if the Fed is tight, if Money Supply is increasing, it has an inflationary effect. One key metric shown below is the “Wenzel” 13-week annualized money […]

The Fed’s supposed independence from the Treasury has always been more rhetoric than reality, and recent friction between Treasury Secretary Bessent and the Fed over currency intervention shows how that rhetoric bends whenever cooperation is convenient. The claimed separation lets both institutions share credit when policy succeeds and deflect blame onto each other when it […]

Even as inflation continues to run well above the central bank’s stated 2% target, the Fed’s latest decision was to hold interest rates steady. The meeting’s minutes were released on Wednesday, August 19th, offering a glimpse into the Fed governors’ perspectives on the economy and their role in it. Three regional Fed presidents, Beth Hammack, […]

Current Trends The US government has borrowed over $800B in the last three months. This is a gargantuan sum of money that annualizes to ~$3.2T. This is an astonishing amount of money given the economy is not technically in recession. If there is an even a minor bump in the economy, the government spending will […]

The Federal Open Market Committee left its target range for the federal-funds rate unchanged at 3.50 to 3.75 percent on July 29, opting for continuity even as price pressures refuse to cool. The 9-3 vote, only Chairman Kevin Warsh’s second FOMC meeting as chairman, preserves a policy mix that pairs flat rates with what officials […]

Money Supply is a very important indicator. It helps show how tight or loose current monetary conditions are regardless of what the Fed is doing with interest rates. Even if the Fed is tight, if Money Supply is increasing, it has an inflationary effect. One key metric shown below is the “Wenzel” 13-week annualized money […]

In his first appearance before the House Financial Services Committee on July 14, new Federal Reserve Chair Kevin Warsh took a firm stance, telling lawmakers that the central bank has “no tolerance for persistently elevated inflation.” Warsh confirmed that June’s Federal Open Market Committee meeting left the federal-funds-rate target unchanged at 3.50 to 3.75 percent, […]

People love to lie to themselves, particularly about themselves. This has been true throughout all of history, and it is now revealing itself to be even more true because of incredible material abundance and new technologies. Artificial intelligence is explicitly sycophantic, but there has always been a large market for things that can increase the […]

As Kevin Warsh takes over as Fed chair, his stated preference for narrower, trimmed inflation measures is drawing scrutiny, and for good reason. Though it is technically correct that government-driven price hikes from wars, lockdowns, and years of interventionist policy are not “inflation” in the strict monetary sense, Warsh’s push to exclude them from the […]