The World According to Jay

(1) FOMC is no longer accommodative, as interest rates gradually have normalized. (2) Normal may be a 3.00% federal funds rate. (3) Brainard says that shifting from headwinds to tailwinds might blow neutral rate higher for a short while. (4) Williams says that r-star’s light is getting “fuzzy.” (5) Powell has a short worry list: escalating trade war, high asset valuations, too much corporate debt, and unstable emerging markets with dollar-denominated debt. (6) Powell endorses supply-side economics, sort of. (7) FOMC’s forecasts suggest Phillips curve is dead at the Fed. (8) National and regional price surveys show September dip from high readings during the summer. (9) Everyone agrees that labor market is tight.