they're not putting in a paul volcker and my fear there is no caffrey coming.. he said the fed could cure everything, economy, stock market. there is own no bad weather, only bad clothing no matter what. you have a feeling this comment won't age well. what is this complex that they have? really amazing to me because i think the fed has too many hats, has too much power and yet he sounds confident that they can cure all that ails us? >> yeah. the fed screws up over and over. originally promised it was going to protect the dollar and it was going to end recessions once and for all. since then we've had 20 recessions, one every five years like clockwork. the dollar of course, we had 125 years of no inflation in this country before the fed. since then the dollar has lost what, 97, 98%. i v in idea where goolsbee gets this confidence from but the fed turning everything it touches into garbage. betting odds it will do it again. charles: yeah. i'm in there with you, my friend. let me know what odds are. i will put a few bucks on it while i can. peter, thank you very m

that paul volcker yield curve inversion, it never recovered. at that time it was 80% of the supply of mortgage credit. this go-around they've put undue amounts of pressure on the small banks system and small businesses so, in essence, the small business sector had to bear the brunt of the weakening of demand that's arguably contributed to the disinflationary process. we've been expecting or viewed small business and climate as overestimated by the bls because of their infamous model for something like 18 months now, increasingly evidence. you can see it in the household survey, the increase in the unemployment rate. and it's now becoming clear the way they conducted policy put all this pressure on small businesses, large businesses were able to benefit from tight credit spreads, borrowing, the credit market, and this whole thing has piled on itself and we've finally reached the point it's become systemic and we're seeing real signs of weakening. >> let me try to translate what barry is saying. if the fed had shrunk the balance sheet a couple of

paul volcker believed the psychology of inflation was so important and i think we still have to overcome this. i think you see pricing power that corporations feel like they have had, i do think that there are obviously price pressures but i also think there's a case where you could see more head winds to that. so, i'm happy that the fed has stayed in there. i think the fed has done a lot to regain some credibility, i think the fed is going to be late, as steve says, and i also think that we're going to have some problems in ahead, but fed's done fine. >> that's just an economic cycle, perhaps, we'll get more on powell's comments on rate cuts today and the potential for those. let's bring in senior economics reporter steve liesman from jackson hole i heard there was a storm, but it looks like sunny skies. maybe that's a transitory metaphor of sorts that you can help break down for us part meteorologist. >> we have such an amazing -- an amazing crew here, leslie, what they did is they held down the tent and then they cleared the rain out. >> wow. >> so it's been great. >> give those guys

austan: paul volcker used to always say our job is to act and their job is to react and let us not get the order mixed up. i fully understand why markets want to jump if they get one scrap of information or they see one thing and they want to conclude a trend on a data point and i would caution us, if we had acted at the end of 2023 based on a couple of observations then the same people what have said but look, inflation went back up in the first quarter, so that was a mistake. i think the most important thing is to look at the through line. what will determine the action is we do not want to tie our hands now. we will get a lot of information between now and the next meeting. what will determine the size or if there is action at all will be the conditions. and that is the way it should be. as i always say, if the data dogs, there is a time for walking and sniffing. the sniffing time is a lot of uncertainty and you do not know what is what. once you get the through line that is the time for walking. sonali: what exactly would it take to see a cut before the september meeting? austan: i

neil: that led to paul volcker getting appointed fed chairman. arthur burns had gone far.ight to remember that. there's this fear the fed has to balance inflationary pressures with delaying a response to the man trigger a slowdown. are we in danger of that as you see things now? >> prices are up. the rate of inflation is down. if the rate of inflation starts ticking backup, i promise you the 10 year yield you will see at 4.4, 4.5, then we could be in the super. it has to be watched carefully. to think you are winning on inflation because you took rates backup after printing $9 trillion, i will give them that and there's been some normalization from where we were but i keep an eye out every day and again he has taken victory laps while people can't afford food and housing, not sure that's a smart move on his part. i think may not be in the last chapter of this. neil: you are not a market guy, nor do you see into that but you look at these developments. i don't care if you are in the white house of the federal reserve you are always looking at how the markets are doing at on

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economy, although and the armed forces, although on economy side, i think you have to say that paul volcker probably deserved more credit than reagan because. it was volcker who, you know, took inflation out of the economy and that the economic rebound in 1984. but, you know, i think that reagan did play an important role in kind of reviving people's spirit and reviving their faith in america after all the turmoil and troubles of the 1970s. so reagan was going to run for reelection. he's running for reelection at the age of i guess he was 73 or four when he running for reelection. so he's running against mondale. he thought he was going to run against mondale mondale, got the nomination after beating off gary hart. why did that election turn to be such a landslide? well because reagan could plausibly proclaim it was morning in america because he got very lucky that the very severe recession hit the country from 81 to 83 was over and we were entering a very strong period of economic recovery. i think the economic growth rate in 84 was something like 7%. and of course it declined in the next

got complete victory and they haven't covered the fire with sand and put water on it and i mean, paul volckerthe fire out before he cut rates, and i don't think jerome powell has done that yet. charles: i love when we get someone from the midwest. that's when you get those campfire analogies. i've got 30 seconds left. i'm looking at your notes and you said recession but no credit crisis. do you still believe the market overall is over-valued here? >> right. yeah, i do. if you just look at profits for over history, and where the 10-year is, and those are the two variables that i use, on a capitalized profits basis, the markets 15, 20% over-valued today. now, that doesn't mean you should short it, or i mean, we've been over-valued before and still gone up, but i get worried about the mag7. so i want to move into value, energy, healthcare, financials. i even think some fixed income makes sense in here, you know? interest rates ought to be inflation plus 1%, so it's three plus one, that's four and that's about where interest rates are so for the first time in 15 years, we don't have interest rate

economy, although and the armed forces, although on economy side, i think you have to say that paul volcker probably deserved more credit than reagan because. it was volcker who, you know, took inflation out of the economy and that the economic rebound in 1984. but, you know, i think that reagan did play an important role in kind of reviving people's spirit and reviving their faith in america after all the turmoil and troubles of the 1970s. so reagan was going to run for reelection. he's running for reelection at the age of i guess he was 73 or four when he running for reelection. so he's running against mondale. he thought he was going to run against mondale mondale, got the nomination after beating off gary hart. why did that election turn to be such a landslide? well because reagan could plausibly proclaim it was morning in america because he got very lucky that the very severe recession hit the country from 81 to 83 was over and we were entering a very strong period of economic recovery. i think the economic growth rate in 84 was something like 7%. and of course it declined in the next

>> we know paul volcker did push back.stration in the '80s, he said that would give incentives to work, save, invest, you can't go on like this, overspending. you have to have a plan to balance the budget but fed chief powell doesn't like to get into that rain. he says that is not our business. we take the fiscal situation as given. so what i want to know is, the fed it's fine, they say they don't care about politics but both harris and trump are suggesting that the economic agendas being put forth by their competitor will lead to inflation. they both say that they're looking at future inflation. so now is the fed ignoring that and saying we're going to go into a cutting cycle no matter what? because what happens if inflation does start showing up again because of the increased government spending under harris or some people think that tariffs will cause an increase in inflation? won't the fed won't have to go back to its model, its only tool to curtail demand is raise interest rates? charles: wow that is a real, real, rea

articulate a message we may need to figure out a way to level this the way ronald reagan go and paul volcker what they can definitely point to is that we've already had these two presidents run. we know what the economy is like under joe biden. we know what it was like under trump. i think they can just easily point to the records and here is going to be the touch point. can you actually feel the pain of the people out there? it's connecting with what they're struggling with. i was talking to some families this week where they were talking about having to go to numerous different grocery stores finding the sales at every place and we were talking about middle class families needing extra time to try to be able to make ends meet just with food and so you have to touch that pain. that's something democrats have ignored. i think trump can tap into it. charles: all right, so and folks, even without the politics, ashley i'm sorry i'm out of time but i want to hit one thing and i go back to the earnings report from five below, folks. they got 1,500 stores and 43 states. they have already told you