employment and price stability. >> after that fed decision, again, a hawkish cut joining me now is loretta mesterident and cnbc contributor loretta, good morning. >> good morning, frank how are snu. >> first, i want your take on what jay powell had to say a cautious jay powell. also saying inflation is moving sideways a bit of a shift in the language and tone before powell and the fed seemed to be confident. >> he was right to layout the case that look, we brought rates down 100 basis points since we started cutting. now we're on sort of a pause so they can actually evaluate what the economy is going to look like in the next year. given both cyclical factors and i would say structure factors, it makes sense to be more cautious in the rate cutting from here on in. the cyclical factors are the fact as you said the recent inflation news shows some, you know, stickiness and some stalling out of the progress, less progress they expected to see at this point, and moreover, the down side risk to the mandate have lessened. that is the reason you could go cautiously in the rate cutting the second reason i

we will have loretta mester on. we will ask her what she thinks. >> i think that's -- what's more important than what they are doing next week -- it's likely they will cut. should they be cutting while we are at full employment? prices are stable. that's the question is what do they need to do going forward? we are not getting down to 2% that they want to hit. we see inflation is still sticky here. the question is, what is that tone going forward? are they more hawkish? that's more important of where rates are early next year. >> the tone? >> exactly. we want to know, are they going to pause next year? can we expect rates to come down further? there are going to be some of the inflationary pressures which jordan points out. that's one of the bigger risks. are they going to cut next week? probably. >> what happens if courtney and jordan are connect? maybe the fed cuts less -- even less than people think now and rates remain sticky higher than people want them to be? is the market going to have a problem with that, ev

here to make sense of it loretta mester.rofessor, governor, president, welcome and good to have you with us. >> thanks, and good to be with you, tyler. >> i will anticipate you expect the fed to go a quarter point on wednesday, and then what? >> i expect them to do it because they have not done anything to defer that view in the markets of the public, and i think they will follow-through. then i think they will have to pause. i mean, the data that has come in since they started moving rates down and removing some of the restrictiveness policy, they have said the economy is strong, the fears about the employment part of the mandate have sort of lessened, in fact, employment is holding up pretty well, and the inflation news hasn't been very pleasant in the holiday season. it's basically stalled out over the past three or four months any progress, so i think they will have to sort of stop, you know, beginning of the year is a good time to stop, reassess things, and then see what they learn about where the economy is headed. is

. >>> don't miss loretta mester joining us on "power lunch" today, it is interesting to get her thoughts ahead of the hawkish cut. we'll check in with her just past 2:00 p.m. eastern. >>> four of the mag seven stocks are hitting record highs. but nvidia is noticeably absent from the recent rally and more than 10% below the record high. our next guest said the clock is ticketing on motetizing. >>> and netflix getting a downgrade while another firm hikes its price market. we'll have a bull bear debate as we look to close out the best year in a decade. up 90% since january 1. we're back after this. >> announcer: this is "the exchange" on cnbc. y bed. in the past, he would not have been able to do any of those things. where can nfl fans get a great deal that turns christmas day in the past, he woul into game day? able x marks the spot. the nfl is streaming christmas day games exclusively on netflix, and you don't want to miss a moment. gather round the game because nothing says holidays like family and football. now xfinity customers can add streamsaver including netflix, peacock, and apple

. >> all right for more, let's bring in loretta mester, cnbc contributor great to see you >> nice to see you >> what was your take of jay powell's press conference, his forward guidance, specifically >> yeah, i think it played out exactly as expected. i think coming into this, it was clear that the fed should be thinking about pausing, and i think he made it clear that that's what's on their mind. the dot plot showed half as much reductions next year as the former dot plot did, which is exactly right. i thought something significant he said was that they have reduced the degree of restrictiveness quite a bit, and i think that's important because that's kind of where their mind-set is. you think about what they were doing since september's recalibration, now going forward, this is really about balancing those risks, making sure that they keep the funds rate at an appropriate place so that no matter how those uncertainties that you've just been talking about play out, they're in a good position to address them, either by holding at that current rate for much longer than anticipated, or

joining us on powell's comments is former cleveland fed president loretta mester.ool. what did you think of the comments yesterday? maybe we have a little more room, maneuverability and not necessarily have to be in any rush on this? >> i mean, becky, first, andrew, congratulations on the interview. it was nice to see you got some of jay's personality coming out in a way that we don't usually see in interviews. >> thanks. >> what i heard, becky, is basically the basic narrative that the fed wants to as the economy is normalized bring interest rates to a normal level is still intact. i think he's right. if you look back when they started to reduce rates in september, right, they were clear that they had had more confidence now that ichb flags is going back to 2% and they did -- that was why they cut rates and began the cutting cycle, but they did 50 because i think they were worried about the down side risks to the employment part of the mandate. and what's happened since september is the data has come in, some of that concern about the labor market went away with t