Loose Fed Lips Sink Stocks

We are in the same camp as Federal Reserve Bank of Minneapolis President Neel Kashkari. On March 6, he said, "If we have a run rate that's very attractive, people have jobs, businesses are doing well, inflation is coming back down, why do anything?" We wrote an op-ed in the March 25 Financial Times titled, "The Fed should resist messing with success." We asked: "If the economy is doing well with the current level of interest rates, why lower them?"

Today, the stock market sank in the afternoon after Kashkari said, "If we continue to see inflation moving sideways, then that would make me question whether we needed to do those rate cuts at all."