Kevin Warsh Just Suggested the Fed May Bring Down the Hammer on Inflation. Could It Spell Trouble for Wall Street?
Yahoo Finance ·
When a new CEO takes the reins at a company, they sometimes try to make an immediate high-impact statement, like Elon Musk carrying a porcelain sink into Twitter's headquarters in 2022 and tweeting, "Entering Twitter HQ-let that sink in!" And while new Federal Reserve Chair Kevin Warsh's first move wasn't quite as flashy as Musk's, he certainly made a big splash at his first Federal Open Market Committee meeting. He left no doubt that he wasn't interested in "business as usual." Instead, he clearly signaled his intention to bring down the hammer on inflation. Here's what Warsh said and why it could spell trouble for Wall Street. Sixteen years ago, the Fed officially established its long-term inflation target as a modest 2% per year. That number had been unofficial since 1996, but it wasn't made public until 2012. For almost a decade after that announcement, the Fed largely kept inflation below that 2% target.
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