Hey hey hey hey hey hey hey hey hey hey hey hey hey he he hey he hey he oh brother oh brother oh brother Good morning, good afternoon, good evening, good night. Happy Day my fellow degenerate traders. In a mere 10 minutes, we are going to be hearing from the Federal Reserve the I don't know unelected Illuminati body that controls our entire money supply and everyone's kind of hey, what's that all about but it is what it is. So uh, we're going to get the FED interest rate decision at 2: P.m.

ET and then at 2:30 Jerome Pal, the chairman of the Fed, the daddy of the money printer will be giving us some some I don't know. additional discussion if you will. He's going to have a prepared remarks, then from there he's going to probably be awkwardly answering questions and who knows which way this is going to go right now. The spot: a little red on the day, the que's a little red on the day.

Really, the overall Vibe of of what's happening is a bit red. uh Bitcoin Picking up into the meeting though, trading at 43.5k So uh, Crypto's in the green which is a little bit of a whim. Um, obviously in between the announcement and Jerome Pal speaking, the announcement is at 2m.. But then Jerome Pal gives us more information at 2:30 In between that we could do a little bit more of a breakdown of what in the world's going on with Rumble because it is looking fight y, it's looking like one little hot tamale if you will.

So I'm particularly excited to see how that plays out. I'm also excited to see if we can, uh, get some of these Apex accounts approved um I got blown out this morning. but hey, you know what they say the the eighth times your lucky charm or something like that? So I'm going to be attempting attempting can't make any promises but I will be doing my best a full faith effort to get those Uh accounts pass today or at least to get the profit Target necessary of 3K So I want to see how that goes? Um, and just so everyone knows if you're tuning in right now, fed announcement comes out at 2 p.m. we have 9 Minutes The expectation is no rate change whatsoever.

In fact, the market is 98% confident that we're going to stay. The FED fund rate will stay at 5.25% So really, that it's going to happen 98% chance? Come on, come on, come on, we know that it's not going to change What's going to really influence the market To the upside or the downside are the hawkish and or dobish undertones of was it a unanimous vote? Were they fighting? Did it turn into a brawl? A dive bar Or brawl? What does pal say in the conference is he coming off at Doish or hawkish? So basically it's going to be a lot of Market interpretation of like The Vibes it's a it's a Vibes thing. Um, so we're GNA See, we're going to see how it goes. Um uh Chris Fosi was on Patrick B David the other day talking about the offering live and bidding model live.

Yeah, we streamed that whole thing. It was pretty cool. It was definitely yeah a couple days ago. Uh, but we streamed it and uh I mean rumble's looking good.

it's fighting right now at 680 I would love a push and a close above 7. but hey, I'll take a push and a close above 644 650 something like that. But what's interesting is Rumble is now on the threshold list. Uh, as in it's had at least five consecutive days of half of 1% of their total shares ft on the FTD list.

which if you do the math for Rumble that means at least five consecutive trading days as of close of yesterday. at least five of those days in a row has had at least 1.4 million ftds in a row consecutively. Um, so something a little suspect is going on there. Something, maybe potentially a lot of suspect is going on there.

But anyway, folks, that's where we're at. that's what we're doing. Let me switch this over. Here's the Spy got crushed because of the freaking yeah I got really crushed.

Actually, this is what happens when AMD Google I think even Microsoft started to take it. No. Microsoft bouncing back a little bit, but there's just a lot of red on the day. Um, we we were in a nice bullish vibe in recently.

a little bit of bearishness, but who knows. Uh, the FED might make this a lot worse and we might start to vomit and die. or it could rip it back and we could end green on the day. Honestly, no one knows and that's half the fun of doing this live.

That's half the fun of doing it on this show is. let's just see where all this craziness leads us. Um so I need to ask you guys and this is a very important question because it's going to lead to my accounts either being approved or not being approved. um, markets first reaction.

So at 2: P.m. do you think the Market's going to violently pop up as it in bullish? or do you think it's going to violently pop down as in bearish? I'm making a poll right now uh Rumble Feel free to comment I need to know I need to know I need to know and then actually on that uh options? uh, portfolio? hang on I need to look at some options that I'm in here on public uh what? oh what is my uh average cost sell limit 51 Next done Okay I think I did it I think I did it right. How are you guys voting? Um so I'm in a long spy I was just messing around and I'm trying to get out for break even on that I was just doing some stuffff uh. but the real position I'm in is some so premium that is.

It's working against me. Definitely working. It's working against me at the at this exact moment in time I just was I wanted to Dude I don't know what to do I don't know what to do Should I just cut it and just take my slight gain or do I risk it for the biscuit. Shall I be risking for for the biscuit.

Uh, it feels like I shouldn't cuz I'm already doing all that other stuff like orders, modify orders modify. sound like a nerd Modify: Is it going to let me out? Modify: No, it's not going to let me out Is it I'm just going to. it's going to. it's going to do this to me.

You know it's going to be one of those days. It's going to be one of those days where I just can't get out. Um, 59. Well, hang on.

What time is it? I Need a time check I Need someone to be in charge of the time for me here because it's super easy for me to get distracted. Uh, super easy for me to get distracted on this one when I have so many things going on. there's the time. All right.

we have 3 minutes. time check. Thank you for that. very reasonable time.

Check. Um, take your own advice, cut it and re-enter I put in an order at the mid price I Just am not getting the fuck out. It's too it's the bid by the ask is too far. my order's in I Moved it to the mid price between the bid and the Ask and I'm just unfortunately not getting a fill.

I moved it I was trying to not be completely degenerate. Uh, trust me man. I I tried to do something I Tred To be smart for once in my God forsake in life. Uh, alas, here we are.

Uh, alas, alas, alas, uh, okay. we have this fired up. We're going to get this going their the FED decision is imminent. it is imminent.

Uh. just so you guys know, they're not going to change it right now. I mean this is what the Market's looking at 96% chance of. we're at 5.25% and there's a 96% chance that we stay at 5.25 So like no one's expecting a cut or an increase at all it it it's going to come a lot more down to the the tones and The Vibes and all that good stuff.

Oh so I hope you guys are ready. Um, you guys are feeling a bit more bullish. Uh, you guys are definitely feeling a bit more more bullish. Why can I not get out of this position? I'm so confused CL I'm above the bid at this point.

Godp speed God speed. This is probably going to be the thing that ruins my fucking January It just won't let me out. Um Matt would your personal opinion on the market? up or down? It doesn't really matter? No like oh, did I get a feel I heard something. It was a not what I wanted, not what I wanted.

There's only a small portion of them. It was a couple. All right. All right there.

Did we do it? Three: 44 344 You guys said bullish. So I'm going to go bullish. Actually, we're going to go to the 100 Tick everyone shoot up Batman Because this is about to get crazy. We are firing in Five 4, 3, 2, 1 No Yes No No No.

It was so close it was so freaking did you guys see how close it was? No, no, no, did you see how close it was? Fuck Fls. It was a unanimous decision with new voters barking daily and Bostic and Meer voting as well. So cut skies are obviously in play, but the Fed at best is not telegraphing any timing around it or amount and you could be read to suggest those cuts may come later than the markets now expect. Tyler hey Steve Steve If you look at the statement every the key phrase that everybody was watching for was the one that you mentioned right which was in previous statements quote in determining the extent of any additional policy firming that may be appropriate to return inflation to 2% over time.

dot Dot dot they've gotten rid of that on balance. That should seem like it's net positive in terms of clearing the path for or opening the door a crack for interest rate. Cuts Yet the markets did react marginally negative to this bit of news. Is that maybe fair to say then, that the markets were already ahead of itself with regard to how many and to what extent rates would be cut in 2024.

I I Think that's a good assessment? Uh, Dom I I Always dislike the idea of um, uh, gauging the market reaction right after this statement comes out. I Think there's some black box trading that's problematic. But here's the thing. um, removing that statement Dom was the anti.

Everybody thought that was going to be gone or changed in a way that was no longer going to. um, essentially Telegraph additional rate hikes. The question was, what did we get Dom When it came to telegraphing of cuts, we got a little bit. They mentioned the idea of changing the policies, changing the rate twice once in terms of reduction.

But remember, remember that reduction idea is in negative terms, as in we're not reducing it until we're confident essentially that, um, we're headed com, we're heading back towards 2% on a sustainable basis. Bob I Want to go to you Bob Pani for the market reaction here. Obviously immediate reaction I Know Steve Expressed some concern about blackbox trading, but it does look like the S&P 500 at least took a little bit of a leg down here. What do you seeing? You don't need blackbox trading for this.

This is very clear Pal, there is no reason for Pal to give up strategic ambiguity on the rate. Cuts That's exactly what he has done here. Remember, everyone was expecting some kind of timing that was very, very clear. Back in December, they were expecting 90% plus chances of a rate cut in March The markets come down.

Now it's 50% It's going to go down a lot more after this one here. So I know the Bulls have been arguing that oh, we have disinflation. Therefore, real rates are higher. Therefore, the FED should be more comfortable cutting the problem here.

which I think the FED has acknowledged is the Fed usually cuts when there's economic distress and there is no signs of economic distress. So You' got attention here and I think Pal is ackn the Fomc is acknowledging that with a strong comment. uh, on the economy here. So C The question is this could the market handle um, uh, fewer rate Cuts with a strong economy I think it can.

but this kind of aggressive statement was a little bit of a surprise for the markets. All right, that's the view from the New York Stock Exchange Downtown Manhattan Let's head out to the Midwest Chicago Rick Santelli with what the rates and macro picture looks like in the wake of this announcement, Rick Well, let's let the markets talk first. if you look at an intraday of two-year notes yields, you can see it's spiked up a bit just shy of 430. well below where we were yesterday, well below where we were the day before, well below where we were the last Fed meeting in December when we at 473.

If you look at a 10year 10e, yields popped up well to 4% but here they are well below the highest levels of today. The dollar Index getting closer to unchange the way I read this is I'm totally in agreement with Bob Bani it's a giant Roar Shack Pretty much if you look at all the data points uh, whether it was Ecii ADP Regional fed service like Chicago Philly There's definitely weakness coming into the economy. You could still argue the labor markets doing better. We did see jolts.

We did see consumer confidence. So there's some cross signals going on. But maybe some of the best signals are, you know? Hearken back to 2018 2019 when the newspapers were all upset with the President, political meddling and rate setting. You know, heresy.

But yet, look at what's been going on the last couple days on the 30th. Tuesday Shared Brown Senator shared Brown Wrs a letter to Chairman Pile saying you really need to ease over the weekend on Sunday you had Elizabeth Warren Senator hoper uh Jackie Rosen Sheldon White House all write letters, uh, a letter and all sign them all four you need the lower rates. Seems though the Senators are a bit nervous I would think based on the verbage of most of the FED speak I See, they're going to keep talking tough, but they're going to give the market more than three rate Cuts this year I'm not sure if it's going to match the Market's ultimate aggressiveness on how they lower rates, but it certainly seems as though the table is set. They're never going to give specifics, but as we get closer to the March meeting or maybe even the April May meeting, look for a lot more guidance to get the market on Pace with the FED which is a little out of phase at the moment.

I Want to go back to Steve Leeman He's spent some time going through more of the details of that statement. Steve What can you tell us? Well first, I want to tell you that the way the market on the FED funds Futures reacted. We've had a up and down day. We were down around 48% Probably that March cut went up to 60 65% in part with some weaker economic data that that was helpful on the inflation front, but also some concerns about Community Banks and now it's back down to 45% Was the last read that I saw recently? Uh, so um I Like what Rick said, there is going to be time.

There are several more inflation reports, several more employment reports that the market and the FED can get on the same page about how much cutting there's going to be and how fast it happens. I think the FED is signaling cuts are in the air, but not really giving the market What It Wants in terms of any expectation of timing and the difficulties going to be in the next 20 minutes or so when we get to talk to chair, Powell is teasing Out Mr Chairman What will it take for you in the committee to be confident that inflation is heading back to 2% on a sustainable basis? That's going to be the discussion in the press conference and we'll see how the chair tap dances around that answer. Okay, that's perfect. So let's now reintroduce our panel.

To viewers and listeners out there, we have: David Kelly JP Morgan Asset Management We've got Kristen bitterly Uh, head of Investments at City Global Wealth. We've got Jim Karen at Morgan Stanley Investment Wealth Management. He's the chief investment officer there and of course our own Rick Santelli and Bob Bani as well. Let's go right out to maybe Kristen to you.

First, we've now had a chance to kind of at least first blush. Take a look at this statement. There have been some notable changes there. Do you feel as though this particular statement then changes your outlook? Your models for the balance of the year? The markets did move lower for stocks, but not sign signicantly so, so maybe there was just an incremental amount of development with regard to expectations.

I This for us, it doesn't change anything simply because our base case is that the earliest we would see the first Ray cut would actually be in June of this year. So I think when we hear what was said in the statement, it really is kind of walking back and giving the FED some flexibility because there is a lot of data between now in March and going back to something that David said earlier. when we look at the resiliency of growth. when we look look at the GDP number, the strength of the consumer, the strength of consumption, there's a balance that the FED has to strike there.

So I think pushing back a little bit on the market in terms of anticipating a a March rate cut, and really kind of setting expectations that this is something that's certainly going to happen this year, but it could be more realistic for us to see more of a deterioration in the data or maybe not as strong of a growth picture as what we're currently seeing. David I Want to go to you I I Wrote down as you were giving us sort of your expectations what you would to hear that you wanted pal to admit the economy is growing faster than expected. What do you make of what you actually heard from the statement before we hear from the man himself? Well, I I think that I think that is pretty much what they said I mean I think it was trying to push back on a rate cut in June oh sorry in March and I think it really is setting the table for a First Rate cut in June Uh, because the March meeting they put out forecast but are they going to get enough information between now and then to really want to say hey now they think there is enough sense that that that inflation's headed towards 2% so they'll they'll probably pumped there. Then they don't want to do it in early May because they won't put out new forecast.

So it sounds to me like June September December is what they're thinking three rate Cuts this year providing the economy keeps growing and you know this is this is good and the the other thing is they put in a phrase about the balance of risks and I really think that's what they're looking at here. There doesn't seem to be at the moment a sign that the US economy is going to Keel over and fall into recession anytime soon. And until they see greater damage or potential damage to the economy given the huge run up in markets we've seen, they just you know, see the balance of risk more being on the side of inflation being sticky than the economy falling into recession and that that's why I Think they're being hesitant to to have near-term rate Cuts All right Jim Let's go to you with this: uh, you have argued or you've made the case that the FED should start cutting rates sooner rather than later A Lot of economists are now tilting towards that summer time frame May to kind of July You think that maybe it should still be in March Is there anything in this statement that kind of puts you at ease? or do you feel as though they should still go in? March Well, I I I think Steve Leasman nailed it because the question is Mr Chairman: what gives you the confidence to start cutting rates? We already know inflation's coming down. The six-month annualized average of of Po Pce, which is their measure of inflation is already at or below 2% at this time.

So I think the answer is like what gives you that confidence is that the labor market has to start to get weaker because what's been happening is inflation's come down. but the labor market didn't get weaker. So therefore, they believe that the decline in inflation at this time might not be anchored. So therefore, it might be too soon.

so we have a payroll number coming up on. Friday Look, you know we'll see where that comes out. but I think the strength of the jobs Market is now going to be something that they probably hinge off of. So look.

I mean you know? should they start cutting in in March I it's probably 5050. Um, does the statement seem like they're kicking the can down the road a little bit? Yes, it it. it absolutely does. But I do think that they want to cut, you know know, 75 to 100 basis points This year, they' like to get the ball rolling in March as long as the data cooperates.

so it really is down to the labor market at this point in my opinion. Yeah, I mean what do you think then Jim I just want to pick up on your point. I Mean the labor market does seem to be the key here, and if individuals have jobs, it seems that they're spending I cover the consumer fairly in depth and it seems like there's really no slowing the consumer, even if perhaps they're Shifting the categories in which they're spending I Mean what are your thoughts there on on? If you were on the Federal Reserve making some of these decisions, what would you need to see as far as deterioration in consumer spending, which is such a big important part of our economy to be confident enough to begin to cut those rates without taking on the risks associated with that as well. Yeah, so you look so far the retail sales date is not cooperating.

strong in the third quarter, strong in the fourth quarter. You know, the still tightness in the jobs Market We saw the Jolts report come out. um you know So I think what the FED really needs to start to see and you know, sad to say but they really need to start to see companies uh, have profit margin start to narrow and start to increase layoffs to to improve their bottom line. that's not a great outcome.

But for the FED what the FED is trying to avoid is a price wage spiral inflation. And if inflation's not anchored meaning if the jobs Market's strong enough and if the consumer strong which is 70% of GDP and they're going to continue to consume then maybe inflation isn't isn't necessarily as might not be as anchored as as their hoping. So you know look the readr to the consumer is so far the consumer's pretty strong and if that continues to be the case then we might be disappointed as as Rick Santelli was alluding to hey Steve uh I'd like to revisit a conversation that you and I had maybe just about 24 hours ago with regard to Paul McCully and with regard to what the neutral natural rate of interest should be out there that so-called R star is, Is there anything that needs to happen for conditions to change marketly so that that Rstar that kind of neutral natural rate of interest actually begins to shift either significantly to the downside back towards two or or maybe even higher because of inflationary threats. So the problem with that question Dom which is a problem everybody's having is oursa are supposed to be a long-term thing and we're all talking about in terms of short run or short a shortterm neutral rate.

So yeah, if you have a big weakening of the economy, that's going to change The Fed's View about how much restriction or restraint is putting on the economy I Did want to go back quickly. give an idea another thought to what Jim is saying. I Don't think the FED is quite as married to the level of job growth as it is to Wages. You saw the ECI come down today.

That's the Employment Cost Index. That's something Powell has flagged is one of his favorite indicators. It came in below expectations at 0.9% normal's about 0607. So we're getting there.

I Think wages is the thing that really is concerning to the FED when it comes to the job market and inflation. I Believe they're resigned. In this job market or in this economy, job growth is going to be at or above what we think is normal for maybe some time now, but it's the wage component that is the key to their inflation outlook here now. Jim I Know that you were chomping at the bit here.

What exactly got you riled up? No, No. I I'm I'm I I Think you know I Thank Steve for the clarity I Mean he's absolutely right. It's the wages. When I said you know, strengthen the jobs Market I'm not looking necessarily the headline number for uh uh, you know, for the unemployment rate or or the jobless claims numbers, it really is all down to wages.

Typically there's a Philips curve relationship with bringing down inflation and and the level of and the level of jobs and wages in the economy and so far that's been broken. So um, the fact that wages have held up and that's you know, likely to continue, maybe potentially for a little while. This could be the fly and the ointment that the FED has to navigate through and the communication around this. this wage price spiral inflation.

This is something I'm going to be listening for in um in in Pal's comments later on today. Hey so Bob A lot of the panelists have brought up labor and the jobs Market as part of their yeah as part of their conversation. uh, we have seen job cuts across a lot of different parts of the market, but specifically in technology, and the reaction on the stock market side over the last year has been leadership from that group. What exactly does the economic picture in this statement tell you about what the Outlook is for what is arguably the most important sector out there.

Well, we have selective reporting. We didn't do massive reporting three years ago when Microsoft and Uh Amazon were hiring tens of thousands of new people. We didn't do banners on that. We do banners when they fire a few thousand and that's because people, uh, react more to negative news than to positive news.

So that's a very good point. Hirings was very strong a few years ago in Tech and it's not as strong now. But look what you get out of this statement here: Dom Number one: the FED says the E economy is strong. Number two: I I Think anyone who reads this will come to the conclusion that any expectation for rate Cuts in March and may pretty unlikely at this point.

So the issue is: can the stock market and I'm the stocks guy. Can the stock market handle that kind of disappointment? And the S&P is down 15 points from when the meeting started. That is statistically irrelevant with a 4800 S&P So the answer, at least right now, is yes, it can handle that kind of disappointment. And by the way, strategic ambiguity.

This could all change on Friday We get the jobs report. They're going to go report by report by report. but right now I would say this is a surprising statement, but the reaction is fairly muted in the stock market. Kristen Before we go I Would just like to come back and and revisit.

Sort of a a bigger broader question. What What is the higher risk in your opinion for the FED Is it cutting too soon or cutting too late? I Think at this point, cutting too soon in March You don't want to be in a position where then you have to course correct from there. I Think Ultimately, this difference that we're talking about as to whether or not it's going to be in March or whether it's going to be in June. Just think about it in terms of the market reaction and as an investor and what do you know to be true Right now You know that we've hit Peak Fed Funds rate.

You know that inflation is coming down in line with the trajectory that the FED is looking for. We know that there's $6 trillion dollar sitting on the sidelines in Money Market Funds that had that has increased by one and a half trillion since the FED started their rate hiking cycle. So when you take a look at that backdrop and think about how the market is going to react, it's actually pretty constructive overall. Kristen bitterly David Kelly Jim Karen Bob Rick Steve Thank you all very much for joining us here on this very important Fed decision day coming up.

we will get more reaction to the Fed's decision and of course we're just minutes away from Drone Pal's press conference. We'll hear from the man himself and take you there live. That's right after a very quick break. All right.

J Pal should be speaking momentarily just so you know Market's obviously dipping a bit. Not the craziest action in options here. Let's do uh, options. doesn't know what to make of it.

Some puts were closed, some calls were bought and thrown back in. Maybe we're dipping a bit here I Just I don't know. You guys told me to go bullish and the trade didn't hit and I'm starting to think that like maybe you don't have my best interest in heart I blew up another 17 accounts and I'm at a certain point you have to reflect and be like okay, like what is the consistent variable in the problems and the consistent variable in the problems is you guys like it. It's 100% you uh right there I posted the poll.

More than half of you voted bullish I went that way and it cost me money so thanks a lot for ruining my life like I I Just don't know what else to it's it's so obviously your fault so obviously you're you're lucky. I don't send you a bill for financial damages at this point like you guys are I don't know what it is I don't know if you're having clandestine clandestine meetings without me and you like are somehow like oh, this is how we're going to fuck over Matt today like I don't know what it is I I don't know what it is but I I know something's up and if you guys think I'm so young and dumb and naive to not realize that you guys are clearly working against my best interest I Notice Oh oh I I notice you'll all pay one of these days. One of these days when I get my life together, you're G to be One of these days when I go to the gym more, stop abusing alcohol, meditate read: like when I clean up my act. You guys are in so much trouble.

You guys are in like once. I Figure out this whole life thing. You guys are screwed. You guys are absolutely screwed.

Ah, it is what it is. It is what it is. But dude, you guys are going to pay. You're going to pay.

Are you drunk now? No. This is the start of my my villain. Arc The start of my are we going to dip? should I just short it Now at least Rumble's going up. At least Rumble's going up play more music videos.

Uh, we can't because we're waiting for pal to speak. we're waiting for pal. Do I just go for it. Is it about to do? I Just do it.

I'm nervous. What do I do do I Just order Submitted: Did I just Botom ticket. No way can I get unlucky 18 times in a row? No No way. No No way.

No No way. No order cancelled by order submitted All right has to work right H Has to work right H has to work right. No way. It can't like right? Oh brother, All Right Has it has to work, has has to work H has to work H has to work Spy Spy Just hit a fresh low.

Why aren't the Q's going as well I Just got an alert that the spy's breaking H has to work. has to work. No, don't do this to me. It's just give me my trade.

Really, it can't just give me a little bit of a break. Order Submitted: Fuck this. This is stupid I Fucking Hate trading. Trading is the dumbest shit ever.

Fuck trading. Trading is dumb I'm never trading again. Fuck this trading is so fucking dumb. It's for it's it's a fucking scam.

The market is a fuck this. I'm shutting it down. It's stupid fucking dumb Trading is it's so stupid. It's so.

it's so fucking dumb trading. It's a giant fucking scam man. It's a fucking pyramid scheme where you always lose. at least in a normal pyramid scheme.

At least someone's making money in the pyramid scheme of trading. Everyone fucking loses 100% of the time. If you're watching this, you shouldn't trade. Don't trade.

Trading is fucking dumb. They they should do. You know what trading is trading is Latin for haha Now you're poor. That's what trading is Latin For people don't realize that it's an acronym.

It's an old old Latin acronym that means haha Now you're poor. You got fucked. That's what it is. So so so stupid.

I Fucking Hate trading I Hate trading so much Whoever invented trading I Just want to I Just want to fucking strangle them I want to snap their little dweeby nerdy fucking neck I Just want to break their neck. Whoever invented trading I'm going to I'm going to do a little bit of historic research and I'm going to find the first person who invented trading and I'm going to find their family lineage and I'm going to end it I'm going to find out who they are, what their problem is and I'm going to have some harsh words I One of us is going to end up crying I I Am telling you this now. One of us is going to leave the conversation in tears and it's not going to be me. It will not be me I Fucking hate this I hate it I hate it I hate it I'm never trading again.

This is fucking stupid. This is the end of the I'm doing something else with my life I Need to find Jesus or something. This is stupid I Fucking hate it so much I need Jesus oh why why me? The markets are dumb there. It's a giant fucking scam.

It's a giant fuck. Markets are stupid. The only thing that's going to fix this is what was it Steel Panthers Have F bombs met their quota? Dude it it. this game is rigged.

This game is it's fucking rigged. Man it's rigged it. It's rigged I don't know what else I don't know else what you need to know but it it's just. it's straight up fucking rigged.

This game is rigged. No one wins at this game. Uh, what would Jesus do? How big was your Don Well how many accounts have I blown up in the past like 24 hours? Like basically 50 50 time? 35? Whatever. What's 50 time? 35? Is that like 1.5k or something? Now I'm going to have to make some parlay on the Super Bowl to make it all.

bet. Going to have to make some sort of crazy parlay just just to financially save myself So was like actually it's ,750 not, 1500 thanks than I Appreciate that but did you at least have fun? That's the worst part. No fun was had. It would be one thing if it was dude.

the Market's going to vomit out if I just held the position. Dude, not only are you guys going to be S when I get my life together, but the Market's going to be S Like it's just the Market's going to be more sorry than you guys are going to be sorry. That's how freaking sorry the Market's going to be. It's it's going to be wild.

Everyone's going to be sorry once. I once I Figure my life out. Every everyone's in trouble, everyone's in trouble Dude. All right, bring this nerd on.

Just open again. a whoop ass. All right. Are these guys going to start talking anytime soon? They're just playing elevator music at the moment.

Trust me, you're not missing anything. Still elevator music even though just a weird. Podium with elevator music. That's what the vibe is.

All right. Let's see what this nerd has to say for him to ruin my life. Come on, take the stage. I Just want to buy a cheat cheese steak.

It's my sad food. Yeah, I'm going to get a cheese steak after this. It's been decided. I'm eating a cheese steak when the market is closed.

Good afternoon. My colleagues and I remain squarely focused on our dual mandate to promote maximum employment and stable prices. For the American people, the economy has made good progress toward our dual mandate objectives. Inflation has eased from its highs without a significant increase in unemployment.

That's very good news, but inflation is still too high. Ongoing progress in bringing it down is not assured and the path forward is uncertain. I Want to assure the American people that we are fully committed to returning inflation to our 2% goal. Restoring price stability is essential to achieve a sustained period.

volum of strong labor market conditions that benefit all. Today, the Fomc decided to leave our policy interest rate unchanged and to continue to reduce our Securities Holdings Over the past two years, we have significantly tightened The Stance of monetary policy. Our strong actions have moved our policy rate well into restrictive territory, and we've been seeing the effects on economic activity and inflation. As labor market tightness has eased in progress on inflation has continued, the risks to achieving our employment and inflation goals are moving into better balance.

I Will have more to say about monetary policy about monetary policy. After briefly reviewing economic developments, recent indicators suggest that economic activity has been expanding at a solid Pace GDP Growth in the fourth quarter of last year came in at 3.3% for 2023. As a whole, GD GDP expanded at 3.1% bolstered by strong consumer demand as well as improving Supply conditions. Activity in the housing sector was subdued over the past year, largely reflecting High Mortgage rates High Interest rates also appear to have been weighing on business fixed investment.

The labor market remains tight, but supply and demand conditions continue to come into better balance. Over the past 3 months, payroll job gains averaged 165,000 jobs per month, a pace that is well below that seen a year ago, but still strong. The unemployment rate remains low at 3.7% Strong job creation has been accompanied by an increase in the supply of workers. The labor force participation rate has moved up on balance over the past year, particularly for individuals aged 25 to 54 years, and immigration has returned to pre-pandemic levels.

Nominal wage growth has been easing and job vacancies have declined. Although the jobs to workers Gap has narrowed, labor demand still exceeds the supply of available workers, Inflation has eased notably over the past year, but remains above our longer run goal of 2% Total Pce Prices rose 2.6% over the 12 months, ending in December. Excluding the volatile food and energy categories, Core Pce Prices rose 2.9% The lower inflation readings over the second half of last year are welcome, but we will need to see continuing evidence to build confidence that inflation is moving down sustainably toward our goal. Longer term inflation expectations appear to remain well anchored, as reflected in a broad range of surveys of households, businesses, and forecasters, as well as measures from financial markets.

The Fed's monetary policy polic actions are Guided. By our mandate to promote maximum employment and stable prices for the American people, my colleagues and I are acutely aware that high inflation imposes significant hardship as it erodes purchasing power, especially for those least able to meet the higher costs of Essentials like food, housing, and transportation. We're highly attentive to the risks that high inflation poses to both sides of our mandate, and we're strongly committed to returning inflation to our 2% objective. Over the past two years, we have raised our policy rate by 5 and a quarter percentage points, and we've decreased our Securities Holdings by more than $1.3 trillion.

Our restrictive stance of monetary policy is putting downward pressure on economic activity and inflation. The committee decided at today's meeting to maintain the target range for the Feder funds rate at 5 and A4 to 5 a half% and to continue the process of significantly reducing our Securities Holdings. We believe that our policy rate is likely at its peak for this tightening cycle, and that if the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year, But the economy has surprised forecasters in many ways. Since the pandemic and ongoing progress toward our 2% inflation objective is not assured, the economic Outlook is uncertain, and we remain highly attentive to inflation risks, We are prepared to maintain the current target range for the Federal Funds rate for longer if appropriate.

As labor market tightness has eased and progress on inflation has continued, the risks to achieving our employment and inflation goals are moving into better balance. We know that reducing policy restraint too soon or too much could result in a reversal of the progress we've seen on inflation and ultimately require even tighter policy to get inflation back to 2% At the at the same time, reducing policy restraint too late or too little could unduly weaken economic activity and employment. In considering any adjustments to the target range for the Federal Funds rate, the committee will carefully assess the incoming data, the evolving Outlook, and the balance of risks. The committee does not expect that it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2% We will continue to make our decisions.

Meeting by meeting, we remain committed to Bringing inflation back down to our 2% goal and to keeping longer run, longer term inflation expectations well anchored. Restoring price stability is essential to set the stage for achieving maximum employment and stable prices over the longer run. To conclude, we understand that our actions affect communities, families, and businesses across the country. Everything we do is in service to our public mission.

We at the FED will do everything we can to achieve our maximum employment and price stability goals. Thank you! I Look forward to our questions. Gina Smik from The New York Times Thanks for taking our questions obviously in the statement and just in your Uh remarks. There, you note that you don't want to cut interest rates without greater confidence that inflation is coming coming down fully.

I Wonder what do you need to see at this point to gain that confidence? And as you make those decisions, how are you weighing recent strong growth in consumer spending data against the sort of solid inflation progress you've been seeing? Sorry, see that last part. How? How are you weighing the growth data and consumption data which have been surprisingly strong against inflation data? Okay, so what are we looking for to get greater confidence? Um, let me say that we have confidence. We're looking for greater confidence that inflation is moving sustainably down to 2% Implicitly we do have conf confidence and has been increasing, but we want to get greater confidence. What do we want to see? We want to see more good data.

It's not that we're looking for better data, it's we're looking at continuation of the good data that we've been seeing. And a good example is inflation. So we have six months of good inflation data. The question really is that six months of good inflation data? Is it sending us a true signal that we are in fact on uh, a path, uh, sustainable path down to 2% inflation? That's the question and the answer will come from some more data That's also good data? It doesn't.

It's not that the six-month data isn't isn't low enough, it is. It's just a question of can we take that with confidence that we're moving sustainably down to 2% That's really what we're thinking about in terms of of uh, growth. Um, we've had strong growth. If you take a step back, we've had strong growth.

Very strong growth last year, going right into the Fourth Quarter. Um, and yet we've had a very strong labor market and we've had inflation coming down. So I think Whereas a year ago we we were thinking that we needed to see some softening in economic activity That hasn't been the case. So I think we we look at we look at Uh Stronger growth.

We don't look at it as a problem. I Think at this point we want to see strong growth. We want to see a strong labor market. We're not looking for a weaker labor market.

We're looking for inflation to continue to come down as it has been coming down for the last 6 months. And I'm sorry if I could just follow up very quickly that when when you say that you want to make sure that it's a true signal, is there anything that you're seeing in the data that makes you doubt that it's a true signal at this stage? No. I think it's I I would say it. It seems it seems to be the likely case that that we will achieve that confidence.

but we have to achieve it and we haven't yet. And so I mean it's a good story. We have six months of good inflation, but you can and you know this. You can look behind those numbers and you can see that a lot of it's been coming from Goods inflation for example, and goods inflation running significantly negative.

It's a reasonable assumption that over time Goods inflation will flatten out probably approximate zero. That would mean the services sectors would have to contribute more. So in other words, what we care about is the aggregate number. Not so much the composition, but we we just need to see more.

That's where we are as a committee. we need to see more evidence that sort of confirms what we think we're seeing and that tells us that we are. on, gives us confidence that we're on, uh, on a path to a sustainable path down to 2% inflation. Nick Nick Timos of the Wall Street Journal Chair Pal, It seems to me you raised rates rapidly over the last two years for two reasons.

One was the risk of a wage price spiral. Two, there were risks of inflation expectations becoming unanchored. This morning's ECI report for the Fourth Quarter shows private sector payroll growth running at a sub 4% Pace Inflation expectations are very close to where they were before the inflation emergency of the last 3 years, and given that you appear to have substantially cut off these two tail risks and that you've judged uh here today, current policy is well into restrictive territory. What good reason is there to keep policy rates above 5% Are you really going to learn more waiting 6 weeks versus 3 months from now that you have avoided those two risks? So um, as you know, um, uh, almost every participant on the committee does believe that it will be appropriate to reduce rates, and uh, for for partly for the reasons that you say, you know we, we feel like inflation is coming down.

Uh, growth has been strong, the labor market is strong. Um, we're What we're trying to do is identify a place where we're really confident about inflation getting Gting back at 2% so that we can then begin, uh, the process of dialing back the restrictive level. Uh, so overall I think I Think people do believe in as you know, the median participant wrote down three rate Cuts this year. Uh, but uh, I Think to get to that place where we feel comfortable starting the process, we need some confirmation that inflation is in fact coming down sustainably to 2% if I could ask differently.

Uh, if if you hold rates high as inflation moderates as it as it has been, Target rates will exceed the prescriptions of the tailor. Ru or its variance. What would be the reasoning for holding rates higher than the levels recommended by those rules? Uh, in the current instance, well I I Think As you know, we consult a range of tailor rules and and non-tail kind of rules. We consult them regularly.

They're in our our tealbook and and uh, they were in all the materials that we look at. But you know I Don't think we've ever been at a state. At a place where we were where we were setting policy by them. Um, and they're depending on the rule.

Uh, it will tell you different things there many different formulations. Another way to think about it is implicitly is. um, so in theory, of course real rates go up if holding all else equal as inflation comes down. But that doesn't mean we can mechanically adjust policy as real rates.

Sorry, as inflation comes down doesn't mean that at all. because for one thing, uh, we we don't know. We look at more than just the FED funds rate. We look at broadly Financial conditions.

But in addition, we don't know with great confidence where the neutral rate of interest is at any given time, but that we wait around for uh to see you know, the economy turn down because that would too late. So we're really in a risk management mode of managing the risk as I mentioned in my opening risk that we move too soon and move too late and I think to move which is which is where almost everyone in the committee is is in favor of of moving rates down this year. Uh, but the timing of that is going to be linked to our gaining confidence that inflation is on a sustainable path down to 2% Howard Hi, uh, thanks. CH I'd like you to to key in on the use of the word um in the statement that inflation Still Remains elevated.

Um, you've pledged to cut rates before inflation reach 2% So that implies that there's some sort of intermediate step here on inflation and that a cut would be consequent with a change in the statement language that inflation remains elevated. What's the step down from there? Yeah, I I I Don't know that we've worked out the particular statement language and that kind of thing I would just say if you look at you, look at where where a 12month inflation is and it's you know it's still well above core is 2.9% for example, 12 months which is way down from where it was. very very positive development, very fast decline, and and you know the the the case is likely that it will continue to come down. So so that's where that's where it is.

But we're you know we're wanting to see you know more data. So uh, if if I could follow up on that, the statement um allows that you want greater confidence on uh, inflation falling before you cut. but it doesn't mention the other side of the Mandate a sliding employment would a sliding employment also? Uh, bring you to the point of of cutting rates? Yes, So uh, let me say that we're not looking for that. That's not something we're looking for.

But yes, if you think about, you know in in the base case. uh, the economy is performing well, the labor market remains strong. If we saw an unexpected weakening in in, certainly in the labor market, that would certainly weigh on cutting sooner, Absolutely. And if we saw inflation being stickier or higher, or uh, those sorts of things would argue for moving later.

Uh, in the base case though, where where the economy is healthy and we have, as you know, we have ongoing growth, solid growth. We have a strong labor market. We have inflation coming down. that's what people are writing their sep around.

and in that case, what we're saying is based on that, we think we can and should, uh, take advantage of that. And and be careful as we approach that question of when to begin to dial back restriction: CLA Jones Financial Times Just to Circle Back to um, the greater confidence aspect of the statement. Um, there's been a lot of unanimity in recent meetings. I'm just wondering going forward when it comes to all needing greater confidence is the unanimity or at least consensus among Fomc members about what the threshold for that greater confidence is.

And if not, could you maybe tell us a little bit about the discussion today on you know what the variations between Fomc members was on what constitutes enough confidence to cut rates, and also if there was any variation on how quickly that greater confidence threshold could be reached. Thank you, We're not. We're not really at that stage. You know we're we're we're There was no proposal to cut rates.

Uh, some people did you know talk about their view of the rate path. I would point you to the SCP uh as as U you know as good evidence of where people are. although it is, it is one cycle later so you know we, we are. we're not.

We're not at a place of of really working out those kinds of details because we weren't actively considering. You know, a moving moving the Federal Funds rate down. I Will say there's a there is a wide disparity, a healthy disparity of views, and you see that in public uh, public statements in the minutes uh, and the transcripts when they're released every five years. So we do have a healthy uh set of differences.

and I think that's actually essential for making good policy. We're also able to reach agreement generally because we listen to each other, we we compromise, and even though not everybody loves what we do, they're able to, for the most part able to join in. To me, that's a that's a well functioning public Institution Rachel Hi Chair Pal Rachel Seagull from The Washington Post Thanks for taking our questions. So over the past few years there have been all these real- time indicators that helped us gain a sharper understanding of where the economy was, like open table data or office attendance.

You've talked about vacancies in the past and I'm wondering at the start of this year what might be on that dashboard for you? that's giving you the clearest picture of the economy, including on rents if you could touch on that, including rent, rent cost. Yeah, yeah, well, so we're not. You know, it's not the pandemic, so we can actually rely on more more traditional uh forms people are working, they're getting wages uh, and and the economy is largely reopened and is broadly normalizing as you see. So I wouldn't say we're looking at that, that sort of more Innovative data as much.

Um, you know you point to rents. So of course we follow the components of inflation very carefully. which would be Goods inflation I Talked about that a little bit. you mentioned housing inflation.

So the question is, when will these lower Market rents find their way into measured rents d as measure measured in Pce inflation And we think that's coming and we know it's coming. It's just a question of when and and how big it'll be so, but that's in in everyone's forecast I would say so that will that will help, but at the same time we think Goods inflation will. Probably it's been giving a lot of disinflation to the effort and probably that declines over time, but it may well have some some more time to run. You know these the Supply chains are not perfectly back to where they were.

In addition, it takes time for the the healing process to get into prices, so there may be still a Tailwind we'll find out with with that. So we look at the things that relate to our mandate very carefully and uh, as you would imagine, I Guess this is a quick followup. Do you feel comfortable at this point saying the economy has reached a soft Landing Or is that part of looking for more confidence? No, I wouldn't I wouldn't say we've achieved that And I I Think we have. We have a ways to go.

Inflation is still. You know core inflation is still well above Target on a 12-month basis. 12 months is our our Target Certainly I'm encouraged and we're encouraged by the progress. but uh, you know we're we're um, we're not.

We're not declaring victory at all at this point. We think we have a ways to go. Steve Thank you Mr Chairman. Um, you said that you would know the by its works.

So I'm wondering what you could tell me. how do you believe the neutral rate is working? We're telling you right now that growth is stronger. In other words, how much is the economy really being restrained right now by the current funds rate and how much restraint does it really need? Additionally, if inflation is still coming down so it's I think you you do see in the interest sensitive parts of the economy you do see for example, housing. you see the effects you do your.

Your second question though. really I think is important and that is a lot of this has come through. Uh, a lot of the disinflationary process has come through the healing of Supply chains and also of the labor market. So you've seen you know that other set of factors is really different from other cycles and has brought that working with tighter tighter policy which has enabled the supply side to recover.

I Think is the that mixture has been behind what has enabled this? Um, so no. We really do think that we're having an effect broadly across the economy I would point to the intensitive uh uh parts of the economy as well as as spending generally. Um, but it's a it's a joint story. It's a complicated story, but but how much restraint are you actually imparting to the economy would you say relative to the neutral rate? it's so I Think it's it's Of course you know that it's not something you can identify with any Precision but if if you a standard approach would be to take the nominal rate 5.3% let's say and subtract a sort of a a forward measure of inflation if you do that.

and there are many many ways to calculate the neutral rate. but that's one I like to do and you you're going to get to something that is materially above mainstream estimates of neutrality of the neutral rate, you will. and but at the same time you look at the economy and you say this is an economy That Grew 3.1% last year and and you say what does that tell you about the neutral rate? What's happening though is the supply s has been recovering in the middle of this so that that won't go on forever. So a lot of the growth we're seeing is not is it isn't just a tug-of-war between between interest rates and demand you're getting.

you know more activity because of the of Labor Market healing and Supply chains healing. So I so I think the question is when that Peters out I think the the you know the the Restriction will show up probably more more sharply. Next, Um, thank you Sorry, thanks for taking the questions Mr Chairman Um, you mentioned earlier, we're not seeking a weaker labor market I think the is you said. can you talk a little bit more about that? Do do you think the neighbor market now is back to quote unquote normal and that um, uh, the we can uh, achieve uh the inflation Target without wage gains coming back down to what they were pre- pandemic.

Even with today's ECI levels, they were still above those pre-pandemic I Think the labor market by many measures is at or nearing normal, but not totally back to normal and you pointed to uh, one or more of them. So I Think you know job openings are not quite back to where they were wages or wage increases rather are not quite back to where they to where they would need to be in the longer run. I I Would look at it this way though. um, the the economy is broadly normal normalizing and so is the labor market and that process will probably take some time.

So wage setting is something that happens. It's it's you know. probably will take a couple of years to get all the way back and that's okay. that's okay, but we do see you saw today's ECI Reading You know the evidence is that that wage increases are still at a healthy level.

very healthy level, but they're gradually moving back to levels that would be more. Associated G Given assumptions about productivity are more typically associated with 2% inflation, it's it's an ongoing process, a healthy one. And and you know I Think we're we're moving in the right direction so that process can continue without a weakening of the labor market. Basically I Think the labor market is it I Don't know if it's rebalancing clearly that the there was a, uh, fairly severe imbalance between demand for workers and Supply at the beginning of the pandemic.

So we lost several million workers at the beginning of the pandemic from people dropping out of the labor force. And then when the economy reopened, you remember 2021 you had a severe labor shortage and it was just it was everywhere. Panic on the part of businesses couldn't couldn't find people. So what's happened is uh, we expected labor the Labor uh, Supply labor market to come back quickly and it didn't And in 2022 was a disappointing year and you know we were kind of thinking well, maybe we won't get it back And then 2023, we did.

As you know, so labor force participation came back strongly in 23 And so did immigration. Immigration came to a halt during the pandemic. So and so, those two forces have significantly lowered the temperature in the labor market to will. It's still a very strong labor market.

It's still a good labor market for wages and for finding a job. but it's getting back into balance and that's what we want to see. And you know one great way to look at that is what's happening with with wage increases and you see it now across the the major things that we that we track. it isn't every quarter, but overall there's a clear Trend still at high levels but back down to where would be what would be consistent with with where we were before the pandemic and with 2% inflation Chris hi uh Chris Rugaber at Associated Press thank you I Wanted to follow up on Rich's question.

uh it sounded like you suggested that uh, you're not worried about faster growth so much so. Wanted to see if you're seeing anything that suggests that inflation could re Accelerate from here and it sounds like you're saying you're not worried that um, solid growth from here on out poses any risk to inflation. Thank you? No I think that that is a risk. The risk that inflation would uh would re accelerate I think the the greater risk is that it would that it would stabilize at a level meaningfully above 2% That's that's to me more likely of course if lab if if uh if um inflation were to Surprise by moving back up that would we would have to respond to that and that.

That would be a surprise at this point. But I Have to tell you. that's why we keep our options open here and why we're not. You know, rushing.

So um I I think both of those are risks. but I think the more likely risk is the one that I mentioned which is you. You've had six good months, very good months. But what? What's really going to shake out here? You know where what what will When we look back, what will we see? Will will, inflation have dipped and then come back up? Are the last six months flattered by by factors that are that are oneoff factors that won't repeat themselves.

We don't think so, we don't. You know that's not what we think, that's the question we are asking we have to ask and we want to get Comfort on that and just one quick followup. Uh Governor Waller had mentioned the um uh revisions that are coming on February 9th for the CPI data. Is that something you're watching as well and if if we see those revisions fairly minor? uh, is that going to give you more confidence? uh, where things are going, we'll just have to see.

Yeah, we'll We look at those. Last year was a oh, we look at those a surprise Michael Mcke Bloomberg Radio and Television Uh, if you don't want to use the term soft Landing uh would you say at least that? uh, from your point of view, Now the other scenario of a hard Landing caused by the FED is off the table or the risks have diminished. Uh, very much. And uh, you mentioned um below 2% inflation for on a three-month basis.

Core PC has been running at 1.5% and there are those on Wall Street who think that if you maintain the level of restriction you have right now, you could end up with inflation running below your target. Uh, how do you see that? So how to Des Your first question: How to describe where we are? So I guess I Would just say this executive summary would be that growth is solid to strong over the course of last year. Um, the labor Market 3.7% U unemployment indicates that the labor market is strong. We've had just just about 2 years now of of unemployment under 4% That hasn't happened in 50 years.

So it's a good labor market and we've seen inflation come down. We've talked about that. So we've got six months of good inflation data and an expectation that there's more to come. So this is this is A This is a good situation.

Let's be honest, this is A This is a good economy. But what's the Outlook that's looking in the review? The Outlook We do expect growth to moderate. Of course we have expected it for some time and it hasn't happened, but we do expect that it will uh at as supply chain and labor market normalization runs its course. Um, labor market is rebalancing.

As as I mentioned, job creation has slowed, the base of job growth has narrowed. Um and of course 12 12 month uh inflation is is above Target And and