Fed Holds Rates, Three Officials Dissent in Favor of Hike: Fed Special

[00:00:00] Speaker 1: i'm going to start with a quote from a late fed chair this one from alan greenspan i know you think you understand what you thought i said but i'm not sure you realize that what you heard is not what i meant i don't think anyone really understood much the last 45 minutes and the market right now still trying to figure it out the chairman talked about this market move we've seen in between meetings this market is playing the ball and not the referee take a listen [00:00:25] Speaker 2: nominal and real yields are materially higher across the treasury curve in fact some of the increases in market interest rates between fomc meetings are among the most significant in the last two decades in the intermeeting period market attention centered on real data and real economic developments prices reacted in real time to incoming information and the reduction in forward guidance may have been a factor market participants are learning to play the ball not the referee and market prices will continue to respond in the direction and magnitude they see fit so is the [00:01:10] Speaker 1: fed chair outsourcing monetary policy to the market and if it is is this market starting to wonder whether this fed will actually follow through the most important part of this move today and this market cross asset is in the bond market check this out look at the yield curve two-year yields questioning whether this fed will actually follow through on an interest rate hike yields dropping at the front end by six basis points and with that questioning the conviction to actually do something about the inflation that the chairman is telling you they will do something about look at the longer end of the yield curve 30s untethered yields up by seven basis points 516 on 30s lisa that's an interesting market reaction to a fed share that for many was confusing over the past 45 minutes frankly he came out said that [00:01:58] Speaker 3: he was really happy to have the input of the market but he wasn't outsourcing the fed's decision to the market he talked about these four goals these deep questions that we talk about every single day but gave no conclusion as to direction he talked about a divided committee is not divided but united in a determination to bring down inflation this market said you know what we're going to call bs on this and you're not going to hike rates and you're going to try to job on us and you think that we're going to do the job for [00:02:23] Speaker 4: you and so they're calling the bluff i i would like us to extend this show to 5 pm frankly john i know you got early hours uh tomorrow morning but that was an historic press conference there was all sorts of little tidbits there and we've got wonderful guests to talk to you about this but every sense of that was radically different than anything we've seen in recent allow me to quote another central banker and [00:02:47] Speaker 1: this is the fed governor on the board right now chris waller going into the quiet period he made this statement sternly staring at inflation until it melts before our withering gaze is not an option bramo is it an [00:03:01] Speaker 3: option so uh what i love from renaissance macro from neil duddy came over and he said worse my judgment is this is a period of watchful thinking so i guess a withering gaze is an option because ultimately kevin worse could not answer the question if you still believe that inflation is a problem why did you not hike today he could not answer that question what would make you hike reaction function reaction function is just guidance uh is just a prediction hidden in that is that true no it's an understanding of which data and what could potentially make you uh pull the trigger what i also think was interesting he kept saying that the market is a pure input into what the market believes that the data is showing us no and neil dudda points this out too it was a reaction to fed speeches they were indicating they were moving in a more hawkish direction this is very difficult to say that this market is just playing the ball [00:03:50] Speaker 1: and not the referee three descents at this federal reserve meeting rates kept unchanged the confusing news conference for the past 45 minutes bramo did you nail it i i missed i missed by 20 seconds i believe [00:04:02] Speaker 3: no no no by by 17 seconds we're taking bets on how long this news conference would last when i came pretty close 45 32 it was a 45. is play the ball from the caddy shack i'm not sure where that quote is from [00:04:14] Speaker 1: play the ball not the referee isn't that fairly well like well known that i think so right from the world yeah i think so it was from the world cup okay all right two-year yields down by seven basis points stop to run in the program tolston slok of apollo with us around the table tolston good afternoon hey big challenge for you buddy first up translate the last 45 minutes what did you learn well the [00:04:33] Speaker 5: first observation is that powell actually also had three descents in april and he also had three descents in december so having descents is not unusual that's not a worst thing we also had that under powell but that being said there's very little to hang your hat on in the market we didn't get any guidance in any direction and it was also a little bit complicated to figure out what was the basis for the decision today in the sense of when mike mckee asked well what are we waiting for we didn't get a clear answer for what exactly are we waiting for which was of course was a subtle way to try to get some forward guidance but this is the part of the challenge we're not delivering forward guidance that when mike and others ask about what is it that you're watching what exactly should we be watching then the answer is that we're not really giving any guidance and the market can figure it out on [00:05:16] Speaker 1: their own the price for that is volatility and you could see that in the swing in the market over the last hour or so equities were positive they turned negative again bring up the bond board if we can and just look at twos tens and thirties this move in the yield curve toss and i'd love to get your reaction to this because you were watching this closely throughout the news conference this move at the front end and how it informs this move at the long end of the curve well what was [00:05:38] Speaker 5: interesting was that tenure rates really went up and down like a yo-yo for a better part of the conference that's a little bit unusual normally tenure rates take a step either up or down as we move forward in the press conference but the fact that there was such a swing it is also telling you that markets are trying to figure out are they hiking at the next meeting so yes fed fund futures are saying now there's a 70 chance that they will hike at the next meeting but what was also the interesting question is when he was asked about well if markets then are predicting say 80 90 chance of a hike going into a meeting are you going to deliver on that and the answer was no we're not going to deliver on that it will all be contingent on the debate that we're having and markets may be pricing what they're pricing but we're still going to go with just what the committee is thinking so in that sense the market pricing in some sense is helpful but at the same time we in markets can't really even rely on that if expectations are saying we're getting a hike at the next meeting that we are actually [00:06:27] Speaker 3: getting a hike what this market is saying right now is that he's bluffing because if you take a look at it it was 70 chance of a september rate hike now it's 50 chance of a september rate hike and dropping in real time how much do you view the 30 years the real uh tell in terms of what the market is taking from this fed which is potentially you're not going to hike rates and you're going to hope that job [00:06:46] Speaker 5: owning is just going to do the job yeah because 30-year rates are basically saying if you're not hiking rates then we are hiking rates and that's why 30-year rates have just made it much more expensive to borrow to buy a house and as a result of that financial conditions are tightening right and he didn't tighten financial conditions but the market decided to say well then we think it's time to tighten [00:07:02] Speaker 4: finance and john i know you've got a question the key thing to me john is 30-year rates 520 is a key [00:07:07] Speaker 1: print we're at 517 520 is an omg print the price of volatility is that what we're learning the price of reducing guidance reducing communication being very very unclear about what on earth they're going to do with policy are we paying the price this morning and this afternoon but that's why the task forces will [00:07:26] Speaker 5: be very very interesting because they will certainly also on the communication task force they will have to discuss what is the best approach is it the best approach to have no forward guidance is it a better approach to have forward guidance if you do not have forward guidance you do have more volatility but in fairness to kevin warser's point he did say that well when we don't say anything markets are reacting to the data as we go along but the risk of course is that if the market is overreacting to some data that then also needs to be resolved in the task force on communication namely is that the right way to do it because it runs the risk as you're saying john that you will get have more volatility [00:07:59] Speaker 4: turstin thrilled to have you here with this really odd press conference there was a bombshell in there where he went back to 2014 and a paper he did on the lucas critique it's just slipped in there for a second but to academic economist that is a bombshell what he said and what he's basically saying is the distrust that robert lucas the laureate had of models are we you know i think of claudia san at least you mentioned this earlier the idea of reaction functions is this a new almost model free federal reserve away to lucas and even away from the giant olivia blanchard it does lean into the chicago stanford [00:08:40] Speaker 5: school of thinking namely that when you have a policy that you are changing you should not run regressions and look historically at the data up to where we are now because the change in the policy [00:08:50] Speaker 4: is going to change how people is there a new model then is there a new fresh worse model we need to [00:08:55] Speaker 5: discover yeah because i think he's saying that you can't just look at all the models that look back because when we are now changing policy then forward looking people are going to change behavior how do [00:09:04] Speaker 4: you determine an inflation rate across that if you take dsge richard claret or gertler brown if you take the mathematics of that throw it out the window for this show but the bottom line is inflation is the measurement we use how will we measure inflation with a new wars lucas model but that's exactly right [00:09:22] Speaker 5: tom that's why if you don't have the models that look at the latest data then what are you then looking at what are you then relying on for forecasting what inflation will do going forward so in other words if i'm not allowed to look backwards and say this is where the data is coming from and the trend is whatever this or that well then what am i then using as the guidepost for thinking about what inflation will do going forward 10 basis point move on 30s there it is [00:09:45] Speaker 1: almost higher by 11 basis points and closing in on 519. i'm thinking of all the people that would be unhappy with this news conference in the last 60 minutes forget market participants imagine being at the treasury right now and you're scott besson and you're seeing yields go higher on tens materially higher on 30s and then i'm thinking about the others on the committee i'm not an establishment guy i'm very very happy to blow things up and have a new era i've got no problem with that i'm open to new ideas but i just wonder how offended some of the sitting officials might be by how patronizing much of that news [00:10:20] Speaker 5: conference was over the last 60 minutes well it's clear that the sitting committee that he came into had already thought about basically all areas of the task forces before so it's clear that the market here is saying well if we now are getting a day with no hike well then the long end of course is moving basically telling you that well this is all about credibility are you really going to follow through on inflation and that's of course the thing that the fmc needs to go home and think about now the market reaction speaks very clearly that now we need to talk about what is the credibility of the committee because it cannot only be talk you will eventually have to follow through and that's why the probability given this market reaction now has gone up quite significantly that they will have [00:10:59] Speaker 3: to move at the next meeting but this is really important in other words you're saying that the reaction the long end of the yield curve is a challenge the credibility of this federal reserve and will force their hand that if they do not hike rates in september you will see uh some sort of [00:11:11] Speaker 5: unmooring of long-term yields yeah because the risk is if you keep on just talking tough tough tough and therefore markets end up saying well this is just a lot of talk and you don't deliver on that tough talk the risk is of course that the long end will say well if you don't deliver we worry that you are implicitly allowing inflation to be higher despite the talk about not our inflation to be higher and that is indeed a question about the ultimate credibility is the committee ready to vote next time this was not only kevin wash this was nine members who voted to keep interest rates constant at this meeting so at the next meeting many of them must look at the reaction today and come to the conclusion if we want to keep our credibility we do have to move to make sure that inflation comes down and therefore ultimately long rates also begin to go down michael mckee was in the room our colleague [00:11:54] Speaker 1: joins us now for more from washington dc michael mckee we'd love your review of the last 60 minutes [00:11:58] Speaker 6: what's the big takeaway i think it's very similar to yours a lot of words not much information and the fed chair leaves with markets probably going the wrong way from what he would like to see at this point the thing he wouldn't answer is what they actually did today he talked a lot about talking but when are they actually going to do something whether it is acknowledging that the three and a half to three seven five rate range is adequate for the job they want or it's not and they need to raise interest rates and there was no acknowledgement of what the case was really on either side it was a lot of talk about while we're talking and uh that doesn't get the markets anywhere and people aren't [00:12:41] Speaker 1: going to be very happy with what they heard i think mike there was an interesting exchange and you were part of it too when he was asked why didn't you raise interest rates and he basically said well i think rates did rise and he talked about the move in the last 42 days and mike rates rose because for many people they thought this fed might follow through on the data that we've been seeing over the subsequent few weeks follow through on some of the fed speak that we'd seen from the likes of waller the likes of hammock and others too and mike and then it got to this moment where i just thought okay is the fed chair outsourcing monetary policy to the market and if he is but then i don't think he's going to hike interest rates we'll take all that back and mike then we see this move in the bond market i don't want to make too much of a big deal of this move we can take it back tomorrow and in the next week or so but it's material you're up 11 basis points to the long end of the curve on 30s and mike the conversation we're having around the table do you believe that is a market beginning to question [00:13:35] Speaker 6: the credibility of this institution i don't know if that's necessarily true because it's still so early in his chairmanship but uh it is an indication that the market disagrees with what the fed is doing the market thinks at this point that interest rates should be higher and whether or not you believe it's because they're only looking at the data uh it is it is telling the market something that data i suspect that the markets are still looking at the data and putting it in context of well what's the fed going to do about it because the fed controls the benchmark lending rate for the country the markets don't the markets react the markets move around but the benchmark rate is going to be set by the fed and the fed is going to be reacting to the conditions in the economy and we got nothing on what he thought the conditions in the economy are or would be and we got nothing basically on why the markets might be right or wrong and whether that's an adequate uh response an adequate measure to keep inflation [00:14:38] Speaker 1: under control mike thank you buddy these comments from the president certainly won't help so we've got the white house review of things they've just published this is from the president kevin wash is fantastic wash has a board it's a political one wash would love to see lower interest rates given the move we're seeing on the screen right now 30 yields up by 11 basis points those comments from the president this afternoon will not help 30-year yields have just broken through the [00:15:03] Speaker 3: highest levels going back to 2007 just to give you a sense right now of the bond vigilantism that you're seeing in bond markets because they are seeing a more potentially politically motivated fed not necessarily that being the case but given the lack of clarity the a lot of circular talk the lack of any kind of straight answers about reaction function or exactly why they remained on hold and then the president's comments are not a good brew for this particular not at all and bromo to your point [00:15:31] Speaker 1: i think we're both on the same page about this i don't believe that kevin wash is doing the president's bidding right now he's widely backed by several establishment figures when he got the nomination for this job i'm thinking of one i can't think of anyone more establishment than mark carmeny the canadian prime minister who gave him a pretty fantastic endorsement when he got selected for the position i don't think he's doing the president's bidding but the optics of it absolutely stink when you have a problem with inflation and you're saying you're committed to doing something about it but don't follow through and then highlight the market that's doing the work for you and now the market's beginning to push back and at the same time the president's putting out words saying well this is actually what kevin wash wants the optics of that the backdrop for it not a good one and [00:16:13] Speaker 3: conflating the idea of a fed funds rate with the market rate and saying that there was something that happened and that we have done something because that moved the market's saying we're not that silly we're not that uh ignorant we know how this is done it was an anticipatory uh it was an anticipatory market and if you're not going to make good on that we're going to call your bluff hey john this this is [00:16:34] Speaker 4: an historic moment the charts i'm seeing on the screen right now john i've never seen this is basically what's called a reverse operation twist in real time we've never seen it and what's key here which torsten and i know you've got stephanie roth on deck the first and second derivatives of this move have to be digested by a huge body of the american economy let's just start with the housing market [00:16:58] Speaker 1: as just one example well let's just start with what we thought this was all about there was a belief that we were reducing forward guidance so that we could introduce some volatility into the front end of the curve which would help cap longer end yields that you'd start to be more uncertain about what this fed might do but in a different way that maybe the outcome would be more hawkish than it would have been otherwise and what we saw more recently lisa was that dynamic people were talking about it this would contribute to longer yields over time at the longer end of the curve lower yields over time that's not what you see this afternoon when you drop by five basis points at the front end and you are seeing a move of 11 at the long end through 520 on 30s that's not good that is not the outcome people were looking for no volatility if you truly are [00:17:44] Speaker 3: potentially on the fence and are going to move is one thing but if you've got a parent who's saying if you do that again i'm going to turn the car right around and go home and the kid keeps doing that and the parent keeps driving straight to go to the amusement park well guess what the kid's going to keep goofing around in the back seat and that's what's going to keep happening because ultimately if you don't believe that they're actually going to do anything why should you start to [00:18:02] Speaker 1: prepare and price that is that right there that's experience tk that's experience that's my real [00:18:07] Speaker 4: world experience when you're driving and you lean over at the same time [00:18:13] Speaker 1: no lisa has pulled more than one u-turn in her life 100 stephanie roth of wolf research joins us now for more stephanie welcome it's a confusing one sometimes this is straightforward the last hour is anything but what's your takeaway [00:18:27] Speaker 7: yeah i mean i think markets just don't believe them the thing is i do think that the fed will also that the data will ultimately bail out the fed to some extent because the market's saying we don't believe that the fed is necessarily going to be hiking in september uh you know that raises inflation expectations that does exactly the opposite of exactly what worse had set out to do today if we do end up seeing inflation data come in a little bit softer that might bail him out he's basically rather than doing watchful thinking he's really doing wishful thinking if the data ends up coming in line with his side this may all work out but if not this could end pretty poorly you said his side [00:18:59] Speaker 3: and this is important stephanie it seems like the takeaway is that kevin warsch is much more dovish than people previously thought do you think that that's the correct interpretation yeah i think he [00:19:09] Speaker 7: he didn't want to say anything because he didn't want to make it clear that he is you know in favor of staying on hold he wants to make to to have markets do the work for him the problem is like you all were talking about earlier that might have worked up until now being at being you know following what we've heard today the markets are going to do the exact opposite and then what is he going to say in september so i think this is the market realizing that the the first fomc was him trying to establish credibility trying to come across as hawkish and now markets are just not buying it torsted sluck i've [00:19:39] Speaker 4: got the third year to 5.20 rounded up to 5.21 we can do that this late in the day if i have this moving to 30 year yield i'm up to standard deviations how will finance obviously you're good people at apollo but how will finance adapt to what they heard adapt to this reverse twist i've never seen it how do [00:20:01] Speaker 5: you adapt tomorrow morning well this is a very historic day in the sense that we have seen a very significant steepening of the curve that is quite dramatic i'm trying to think back when we ever seen like 20 basis points move in the curve in the steepness like this it is really unusual and the answer to your question is that this sensitive components of gdp that are interest sensitive of course housing and autos will probably continue to struggle they have struggled for quite some time when interest rates have been high but the tailwinds to growth coming from ai spending coming from the one big brittle for bill coming from the home shoring those things will still continue to see tailwind that's why we might get in the next day a half hour when the news come from both the hyperscalers today and tomorrow this could also create some more volatility because that will also begin to become a macro event if that does begin to send signals around what is the outlook for the broader economy [00:20:46] Speaker 1: especially around the data center build out torsten can we talk about the price of the data center built out and the capital raising that we're seeing worldwide right now 30 year yields up 11 basis points that's before we even find out the capex intentions of some major companies in the next 24 hours or so how much pricier does the cost of capital get with this federal reserve well that's exactly the [00:21:07] Speaker 5: discussion because not only of course have spreads on hyperscalers widened out and cds has also widened out now the base rate has also moved up and in this case actually much more than spreads have widened out so the all-in yields for financings of course in the public market for hyperscalers have definitely increased quite significantly the issue now becomes well if your returns in ai are expected to be like 10 15 or higher well then these things are relatively small peanuts relative to the big picture of the returns that are going to come along but ultimately that discussion is all about the economics 101 namely what is the marginal revenue you expect to generate and what is the marginal cost of producing that piece of revenue so for compute the debate is around well now that rates have gone up and all the yields have gone up is it the case that we're reaching a level of all-in yields or all-in cost of capital that's beginning to become more problematic for the hyperscalers so far that has not been the case but the question is of course over the next 24 hours whether we get any either confirmation that that's happening or whether we are on the contrary beginning to see still more upside risk to more data center build out just [00:22:09] Speaker 3: continuing and this is the reason why and stephanie i'd love your thought on what torsen said earlier that all of this is not a virtuous cycle and it's not something the fed wants to see and so torsen was saying that he thinks that the probability of a september rate hike is even greater now to try to control the long end of the yield curve and prevent this sort of uh higher borrowing costs for some of these hyperscalers and the build out do you agree with that i mean i do if the data don't improve so [00:22:33] Speaker 7: if we're if we're sitting here in september and the data just continue to remain firm especially on the inflation side but also on the growth and the the capex data in terms of capex just ai related capex just continuing to to to to move higher then yeah absolutely that increases the odds that they're going to ultimately be hiking i do think that we'll see seasonality in the inflation data and a bit of a cooling such that they that this may all work out such that it doesn't actually have to cut september and in that environment uh it will do so in an environment that's a little bit more market friendly but if that forecast is wrong then absolutely they're they're gonna this makes them even more likely to have to be cutting in september because it tells you that they're making a policy mistake look at this [00:23:14] Speaker 4: moment john of course i got to go to the quality full faith and credit documents spacex's 30-year bond 6.65 we're enjoying it at 7.8 right now not quite through a new low but again the mystery to me is the permeation of this through wall street it's not just about fom's you know lucas critique and all that [00:23:35] Speaker 1: what does this do to wall street starting in asia here in x number of hours you mentioned spacex so they came out with that debt issue in the last month or so and the demand was softer below average and then we had amazon follow-up tk and concessions were larger and then you start start to see spreads widen out in the secondary market too across a number of tech names as well tom and we've been talking about this dynamic for a while the crowding out of the market that there is a race to raise capital and that we've been worrying about the additional supply coming from the treasury for the best part of 15 20 years the deficit it was okay at the time because not everybody else was doing the same thing now we talked about this already earlier in the program germany has gone away from fiscal prudence to borrowing and spending germany has moved on to something else japan has as well they've had decades of deflation they now have inflation anchors away there for that bond market yields up we've now got the hyperscalers moving away from buying their own equity to negative free cash flow and now issuing equity and issuing debt that's additional supply here there and everywhere and every way you look right now there are increased capital demands so to have the fed share perform in the way he has in the last 60 minutes to see the market reaction to that that's led to high yields at the long end of the curve to have that in this moment lisa things get tighter things get harder and yields go up and [00:25:00] Speaker 3: the price for capital gets more expensive and the value of the dollar on the global stage goes down and we're seeing that in a pretty big way it is notable to see the long end of the yield curve in particular perform this way and as torsen made a good point about the hyperscalers they have been issuing disproportionately at the long end of the yield curve they have issued more on the long end than the u.s government and you have to wonder how much this is going to constrain some of the productivity and the virtuous aspects of what a lot of people are expecting and prolong the uncomfortable mismatch period that he was talking about there's also the additional challenge that if you take your [00:25:31] Speaker 5: textbook out and interest rates go up in the long end the dollar should be going up so that's why you're now beginning to ask well it's a dollar now beginning to react to front end rates normally it is the long end that moves the dollar most so there's a lot of considerations also around why is the dollar going down so much at the same time while short rates are moving down and long rates are moving up stephanie in the next [00:25:52] Speaker 1: two weeks we'll all be very focused on the fed speak we were calling this a three-part act all day the statements one act the news conference is another it was quite an act the third act is going to be the speeches of all the officials that haven't had their say yet what are you looking for from [00:26:10] Speaker 7: the fed speak in the coming weeks yeah so we're certainly going to hear from those that dissented why did they dissent because uh worse certainly didn't really answer that question uh so we'll we'll hear we'll certainly hear that argument and then i'm going to be looking for uh you know eventually in the next speech by waller because that's going to give us a sense of what did the core of the committee actually what is he thinking he's been amongst the most transparent and represents more of the middle folks on the committee and that's going to give us a much better sense of what are they thinking what are they leaning and what does he think about what price action is doing because he is somebody who's very willing to give his reaction function and his thoughts on what [00:26:46] Speaker 4: markets and the data are going to do that's right where i wanted to go stephanie torsten schlock how does chairman wash react to what we're seeing on the screen the data and the fact is he's going to have to amend the way he speaks the concepts he speaks the mckinsey mba of it and talk to academic [00:27:06] Speaker 5: economists i think that it's not only him it is the nine versus three on the committee here that there were nine members who voted to keep rates constant today so the consideration for the whole committee must be to go home and think hard about how do we communicate this do we do this before the meeting what do we say at the press conference how do we communicate in the statement because it is clear that this is a somewhat worrying development especially in the long end we do have next week non-farm payrolls let's not forget that so to stephanie's good point the data could begin to move in the opposite direction so who knows we all have all kinds of views on what might be happening on the labor market at the moment so far it's been relatively strong but you're right tom at this point it must really inspire them to look themselves in the mirror here and begin to think about how do we think about this [00:27:50] Speaker 1: situation and given what just happened today lots of fed chairs make communication errors particularly at the start of their term we've seen that repeatedly in federal reserve history this and that way might be no different we do have to go through this process and start to understand how this new fed share communicates what it means to markets and i mentioned this earlier this move in the bond market don't know where it goes we could take it back tomorrow that's not really the point the point is whether this is by design or not is this the intention is this actually what kevin wash the new fed chair wants to see is this the outcome to that news conference that he was [00:28:24] Speaker 3: looking for well if the data is speaking the market is speaking and the market is saying right now we don't believe you so does he have to come out and hike rates who is his audience who is he speaking to i ask that because typically fed chairs have an odd job of trying to uh toggle between the broader public and the markets he wasn't speaking to the markets or if he was that he's not getting the reaction that necessarily he wants given the fact that they've talked about wanting to bring down mortgage rates in particular and this is going to move it in the opposite direction stephanie it's good to see you [00:28:56] Speaker 1: it's always great to catch up stephanie ruff there of wolf toss and slock of apollo wanking on this decision from the fed chair kevin wash and a decision by the committee to keep interest rates unchanged with three descents from three regional fed presidents and then a very confusing news conference that has come with the price and that price this afternoon is high yield to the long end of the curve [00:29:17] Speaker 3: yeah the highest levels that we've seen since 2007 at one point in the final uh moments of the trading session you have to wonder to your point whether he is satisfied as well as whether he is going to rethink how much information he would like to disclose it seems like he thinks the less information he gives is a virtue however i think a lot of people would say that maybe this is not the controlled kind of [00:29:39] Speaker 4: response that leads to any kind of predictability john quickly the bank rate 30-year mortgage is 6.70 percent are we going to enjoy an eight percent mortgage soon after this is going up i don't [00:29:50] Speaker 1: know about eight but it's going up after this if this continues without a doubt the fed chair kevin wash wrapping up his news conference the good news maybe it's bad news for you i don't know but we'll be here at every meeting because there will be a news conference for the rest of this year after every [00:30:04] Speaker 3: meeting a commitment to that from the fed chair again why then would it even introduce the idea of not potentially having one there's so many questions here the lack of clarity is one thing if it's instrumental and creating volatility or if it's lack of clarity for lack of clarity's sake because ultimately you don't want to invoke political ire i don't know and let's see if these moves stick [00:30:23] Speaker 1: let's start there yeah five basis points at the front end up 11 at the long end can