Last quote by Diane Swonk
Diane Swonk quotes
We know that driving miles are up. Prices at the pump went down, but gasoline sales went up.
The retail sales number is not really capturing the move to online. Where you do see strength is food and restaurants surged.
It wasn't a slam dunk number by any means. The wages (number) is the most important, but it's important to know it came off a surge last month. It's a hiccup in wages, but not enough to stop the Fed.
You've got to take it in context. Last month was an extraordinary jump. I'm not happy with it … but at the end of the day the wage number was really strong in October, so you take a moving average and that's what the Fed will do.
I've been hearing mixed stuff about October but retailers sound pretty optimistic about the holiday season, so they must have started off November pretty well.
It will look like a good month because of the autos. The question is what does the core look like.
Consumer confidence surveys show the current situation is fine. Employment is fine. It's the expectations that have deteriorated, which you could expect to see, given how ugly this election has gotten.
I'm looking for 190,000, a little warmer. Retailers are hiring a little earlier than they were. They have pulled ahead hiring to try to compete. It's a sign of a tighter labor market.
Retailers are hiring a little earlier than they were. They have pulled ahead hiring to try to compete. It's a sign of a tighter labor market.
She wants to hedge against another recession.
The last statement was nuanced. It would be nice if this was not nuanced and they say they're ready to go. You get a sense that the debate that's rising in the Fed is about more than a December rate hike. It's about going forward.
If they do put it in, I think it would reduce the number of dissents. I don't think Janet Yellen minds having a pretty big showdown, even with her own vice chairman.
We have an election that's highly contentious. I don't think it's the same situation it was a year ago.
Communications are a wreck. Data dependence was wonderful to convey the Fed wouldn't raise rates for a very long time.
It has been coming down consistently. The Fed has consistently been lowering the terminal rate and lowering its trajectory. The markets have been more accurate than the Fed which we know, but that doesn't mean they will continue to be that way.
I think they add more confusion than clarity because there's such a dispersion. It's not clear how much it represents a consensus of what the Fed expects.
They will want to prepare markets so that when do they move, it will be an almost non-event.
I think the Fed will give us a statement that opens the door wide for a December rate increase.
Inflation data is warmer than expected, and it will give fodder to those (Fed officials) who already coalesced around a rate hike. But we're going to see a hawkish hold.
It doesn't matter if it's September or December. It's where we were a year ago, the Fed wants to get a rate hike in this year. Once-a-year-Yellen.
To keep the dissenters at bay, you need to have a statement that's a little more hawkish. This isn't quite the punt it was a year ago in September when there was chaos in the market and China was on the edge. This time we're getting very, very close. I think (noted dove Fed Gov. Lael) Brainard will get to say let's wait. I think the mixed economic data gives them enough reason to pause.
There is a real issue on cause and effect and a vicious cycle of if you pull out, do you have the tail wagging the dog on financial markets telling the Fed what to do. On the other side of it, we can't afford to have a sort of very disorderly unwinding of financial markets either.
It does make me worried about can we really get the fiscal reforms and fiscal policy we need to get better economic growth and get the Fed sidelined. I'm not sure that can happen.
Austerity sort of took a higher priority than it should have earlier in the cycle.
What Rosengren said is nothing new. Rosengren wanted a September rate hike.
Core retail sales should still be good outside of autos.
We've heard from Dan Tarullo in the inner circle and he's consistent with the view to be more dovish. He's not opposed to a rate hike this year but he would be for December. (The markets) allowed Rosengren to trump Tarullo, and Brainard has an even greater sway in Yellen's inner circle.
Retail sales will certainly be important for the Fed. We get industrial production too which is likely to be lousy.
It's horrible and the costs are going up. It's really hard on margins. This doesn't suggest there's a lot of pricing pressures either.
It's nasty. It really is a tale of two economies still. That's the issue. The consumer is doing fine. It's not going to determine what the Fed does. It's a signal that we've already seen ... that the manufacturing sector continues to struggle.
Investors are not pricing in a Fed tightening. We still have uncertainty coming from abroad, and there are a lot of land mines out there. I think Yellen will want to keep her options open in her Jackson Hole speech.
The Fed has failed to come to a consensus on communications. The blow to credibility is leaving markets pricing a form of infinite easing.
It's the Fed's conundrum. ... The markets are pricing in easing infinity. If they raise rates, they could destabilize the markets. If they don't raise rates, they're feeding a bubble. It's a hard place to be in.
I think she's going to play her cards very close to the vest. I don't think she can signal a September hike.
We're tired of talking about rate hikes when it's not going to happen for a while.
By September, we may have more easing from abroad. My sense is the board is more sensitive to that and it's not about election risk. It's about policy risk. I think December or January is more likely. Is there a chance for September? If you're data dependent, yes ... I don't think they're going to do it but you could have people chattering out there. We've seen a lot of squawking around the Jackson Hole meeting when they're at a pivotal point.
They added that near-term risks to the economic outlook have diminished. That was a throw in there for the people who are looking at the buoyancy of the financial markets and saying they could raise rates. My take on that was to keep the dissents to one. Even though they upgraded their outlook on employment and consumer spending, they left inflation unchanged. That is despite the fact that it is rising.
We've got synchronous unconventional policy and that gets you in a vicious cycle, as well. The issue is how far can we go? Negative rates for the U.S. are a big problem. ... The Fed's trying to cushion the economy. That said, if things go south, they have a problem.
He's one of the more prominent in an industry where you would not expect it.
The Fed is handcuffed at the moment. You have got a lot of things moving in the wrong direction in the view of the Fed because of the vote in Britain.
It's a fine line to walk about not making it too big of a point. You want to discount it a bit, but if you make too big of a point then you talk up the market jitters.
The Fed's dealing with the same stuff. It's just the Fed has painted themselves into a corner with data dependency because one piece of outlier [jobs] data does not make a trend.
The push to inhibit trade, close borders, and [increase] regulation across a broad swath of industries are all a threat to growth in 2017. The only policy offset is the realization by both sides of the aisle that corporate tax reform could bring money home and increase our competitive advantage.
If we get a decline in June jobs, and the U.K. opts to stay in the EU, then we have a shot at a July hike. She's clearly leaving all options open. Cautious optimism was the dominant theme of her talk, and saying not to make too much about the May employment report.
It's the Fed speak we've got to watch, although I think we'll see more dissidents than a symphony. It's a big week for data. I'm not sure it will clarify, it will probably just confuse given the range of speakers we get from the Fed.
There are fewer but better-quality jobs. They're dominated by business and professionals. It's new college grads. It's part of the reason why year over year, we had an acceleration in wages. They are full time, science, engineering and accounting.
They're walking this very fine line which means they can't provide the certainty that markets want, but it's really not helpful either. It's a very dysfunctional Fed confusing the market.
The problem is you've got disagreement. The gap has widened. You've got dissents. When you have dissents, you have volatility.
Divergent monetary policy matters because you can derail stuff inadvertently, and that's what the Fed doesn't want to do either. What happens abroad comes back on our shores. The Fed has to walk such a careful line of saying they're doing monetary policy for the U.S. but they can't ignore international conditions.
I don't think they can put the balance of risk back in, because they can't agree what the balance of risks are. It just means continued uncertainty, continued uncertainty for the market.