result. >> not sure went through the same script as volcker, if you do the volcker thing keep going.e interest rates 25 basis points on september 30th. june, the dots, projects said two more before the end of the year. they did august 1st, sorry, july 27th, right on time. look for one more in september. that is what you have to do if you want to get this inflation under control. as far as mojo is concerned the fed doesn't have any mojo. control the short end of the yield curve absolutely, trading repo market, buying t-bills, funding them overnight you care about that. that is not the economy. the economy is in the 10-year note. greenspan invented this thing, yield to maturity on 10-year note is the present value of a strip of short-term rates. there is no empirical evidence. the 10-year note goes where it wants to go. it can be volatile. nothing to do with short-term rates. the fed is mostly pixie dust and really good pr. we pay a lot of attention to it. i do. i'm a fed watcher like everyone else but the things driving the economy have nothing to do the fed. charles: what about the t

of course enter paul volcker as fed chair.crushing the economy. ironically his predecessor arthur burns said after he left the job listen he would have been more forceful for monetary policy if not for political pressure. be that as it may we got what they call the great moderation. in 1980s all the way through 2007 and beyond, this is when inflation really began to ease. it got to modest levels. eventually inflation for us became an after thought. of course we fast forward to 2020. 2020 and 2021, of course this is when we got inflation that we had not seen in a generation, in our lifetimes. i got to tell you there, is a number of reasons for it but for me i think the biggest is the trillions of dollars that cascaded into this economy during and especially after covid-19. core inflation especiallily stubborn. more and more economists and non-economists like myself have begun to wonder why is the fed insist extent getting to the 2% target with crushing moves that crush the economy if they move it will take us longer to get ther

doesn't matter if it was greenspan or volcker powell does not have to be volcker because he did not have a predecessor who let inflation get embedded seven to eight years before volcker got the helm of the fed. the fed was behind the curve and they made great strides at correcting that error. we think it's showing up in the economy, the markets, the consumer small business holding onto employees like they might not have in another cycle. >> john, great to speak with you. thank you. >> thank you >> let's turn to chips amd is getting ready to report its earnings after the bell. the stock is up 76% this year. kristina partsinevelos has a look ahead to that report and how many times do we think they're going to talk about a.i. >> if we use intel as a barometer, intel mentioned a.i. 58 times for amd's q2 quarter we're expecting lackluster results due to weak data center sales and a slow gaming market let's take, for example, intel latest report shows continued inventory levels and the wallet share is moving to more expensive a.i. chips and away from traditional servers those traditional serve

volcker raised rates, cut rates and raised rates dramatically. powell wants to avoid that scenario. as we round out the investment opportunities here as we round out the third quarter? what you're looking at. >> we're overweight value versus growth. we're overwatt small cap because small cap valuations are underweight. we're underweight non-u.s. because we think there are opportunities down the road. one area scarce us, high yield bonds. bonds are narrow spread. you're not getting confirmation for the risk. relative to commercial real estate these two yields relative to treasurys trade vest, very closely. you're seeing high yield spreads are flat. commercial real estate measured by cmbs spreads have surged dramatically. we're worried about that. we're worried about high yield bonds. we love industrials, we love health care and financials. financials seem like a surprise. financials valuations are more attractive. you have potential m&a activity. you have the fact that easier comparisons year-over-year relative to capital markets like fewer ipos last year, fewer debt issuance last ye

then somebody like volcker has to come in be the sheriff to clean it all up.ven as we speak, even as he celebrates in jackson hole this week. charles: main a vacancy in couple years, peter. i have your number if anybody needs it. thank you very much, my friend. all right, folks, we'll be right back. >> take care, thank you. ♪. blackrock silver is bringing new life to one of the great american mining camps in the silver state of nevada. with a new resource estimate imminent, one of the highest grade silver projects in america is about to get bigger. blackrock silver. the first time you connected your godaddy website and your store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com you ok, man? the internet is telling me a million different ways i should be trading. look! what's up my trade dogs? you should be listening to me. you want to be rich like me? you want to trust me on this one. [inaudibl

it worked from paul volcker. it was painful but it worked. inflation as i said earlier -- thanks for remembering that -- is the most regressive tax of all. >> neil: you talked about paul volcker, the former federal reserve chairman. he was raising rates at the time to beat inflation by a full percentage point at a time. many argue we don't have to do that now. you say we do. >> yeah. guess what? time will tell whether i'm right or wrong. right now, neil, inflation is stubborn. it's still here. they're crawling us down 200 basis points? what the hell? it was 9%, 9.5%. that's like a spit in the ocean. >> neil: so the market worries about the fed overdoing it. the flip side, ken, they hope that certainly most of the hikes are down. in fact, the fed chairman indicated that maybe one, possibly more than that the rest of the year. beyond that he says job done. what do you say? >> no. what do i think? number 1, neil, i will get hit hard if rates go higher. the yields on my stocks become less attractive. people move to securities where they get a bet

and the high commissioner for human rights volcker turk made the case that these abuses are so grave that they pose a threat beyond north korea's borders. many of the violations i've referred to stem directly from or support the increasing militarization of the dprk. for example, the widespread use of forced labor, including late political prison camps, forced use of school children to collect harvests, the requirement for families to undertake labor and provide a quota of goods to the government, and confiscation of wages from overseas workers. all support the military apparatus of the state and its ability to build weapons. kristen, these problems in north korea, they're not new. so why did the security council take this up now? well, there's been this debate for many years in the security council over whether or not it is the appropriate place to discuss human rights abuses, and particularly when it comes to north korea. china, for one, has long argued that it is inappropriate to bring it up in the council, that it only isolates north korea more and increases tensions on the north

tell you, when i heard the navigating by the stars and cloudy skies, i was trying to imagine of paul volckerould have said something like that, and i just cannot get there. what we saw play out over the course of this jackson hole meeting was actually a pretty esoteric economic debate, and it is captured with this other statement by him about the neutral rate, which is sometimes called the r star. so what is the rate of interest that would be consistent stable inflation rates and stable growth, not accelerating, if you will, growth? and they measure against that how restrictive our current rates, which right now based on traditional measures of what that neutral rate might be, these current interest rates are very restrictive. powell says, yeah, but we do not know what that new parade is, and that is what the market is starting to absorb once again, which is that if these rates are very restrictive, but the u.s. economy is still growing very robustly, which is, may be the new parade is not what you thought it was. maybe it is higher, which then feeds into the narrative that interest rates wi

farmers in the kansas city fed district, and they wanted to make it bigger and they wanted to get paul volckero attend. they moved it to the beautiful jackson lake lodge outside of jackson wyoming, the grand tetons, a big, wide fishing spot. he used to love to fly fish. jerry corgan love to fly fish too. that is what started putting this on the map, so there is a lot of history, as i said, over the years. fed chair is if you use this symposium to signal an important message. last year but powell went out of his way to signal, more rate hikes coming. remember how many people were talking about cuts? he opened the door to this more aggressive policy that followed. paul: what are we expecting jay powell to say, and what are markets hoping to learn? kathleen: markets are hoping he will say i am ready to pause. what does he see? this is what we want to know from jay powell. clues on the next rate hike, will it be another pause? does he sound like somebody saying inflation is still too hot, inflation is to come down, the labor market is still strong and signal he is not ready to pause yet even thoug

do you reckon that jay powell going to sound more like alan greenspan or paul volcker in his speech onriday? mark: i think bloomberg economics has his right and is more greenspan. greenspan was known as someone who achieved while fed chairman, the fed achieves a soft landing for the u.s. economy. jerome powell seems to be on that same path right now. it looks as though he will achieve that. last year story was all about eating inflation with things have changed. the dynamics are more international than they were a year ago. he will be very conscious of the fact that the european economy is slowing really fast and the chinese economy clearly is struggling in not performing as it should be. the international factors will weigh on his thoughts more than than they did a year ago. you will probably see that he sounds more cautious than he did and if anything, he may start telling people he does not want the fed overtightening compared to last year when they could not tighten fast enough. a different scenario compared to 12 months ago and by the end of the week, christine lagarde speaks and

economy this is a less interest rate sensitive economy than 30, or 40 years ago, 40 years ago ago paul volckerment, was 60% of business investment that is a very interest rate sensitive category investment, versus today most investments in it dpreeshz consumer durable share consumer experienceding a third of 40 years ago kinds of things people take out loans to buy a smaller share of bundle, but when you have the succession of shocks the most aggressive interest rate hikes in 40 years oil price pressures geopolitical shocks when you have a consumer that is stephanie pointed out struggling because wages have not kept pace with inflation those accumulate, so that is why i think there is a greater than -- two times chance, of a recession in the next 12 months. maria: look at this market, volatility we are way off the highs, reached about 10 minutes ago we are still in rally mode dow industrials up 138 but come off the highs, as wall street digests numbers sees worry spots. >> definitely a reality check for investors here, in that you know there is no cut coming down the pike at any point in the n

volcker didn't like it. greenspan didn't like it. it is a fairly recent phenomenon.at the circumstances in the economy. sometimes 3% could be way too much. sometimes you need to tolerate a higher rate. i think the more important thing are you supporting labor markets, are you supporting wage growth? do you have a pace of inflation that is manageable given the other economic circumstances this kind of robotic focus on 2%, 3% inflation targeting i don't think has been helpful. this 2% target gave us over a decade of highly easy money that really benefited wall street. it didn't do much for everybody else. i think there needs to be a better little of common sense to get away from this singular focus. charles: yeah. >> raising 3%, if they will stick with inflation targeting, they probably are, moving the goal posts for me. being patient higher for longer, with interest rates and inflation. to say you declared victory by moving the goalpost, i don't think that is something the fed should do. charles: gotcha, sheila. great stuff. thank you. >> my pleasure. >> folks the wil

every federal reserve chairman going back to paul volcker, every single one including janet yellen havend said you have to spend less because the interest payments on the debt are just going to become unsustainable. if for her to sit there and claim that spending is solving america's economic problems is really too much to listen to. paul: all right. kate, you looked at the ron desantis plan this week. what did you like about it? >> well, paul, i mean, desantis set out a 3% growth target for the economy which i think is worth dwelling on, because that will being essential to digging out of this problem. he also backed it up with some good ideas to get to 3% growth. energy production would be one of them, getting millions of prime-age men back in the labor force, even school choice, i think, is a great growth policy. so there's a lot to like there. i think there are some questions about whether that will continue to be his guiding star. i mean, he said he wants to simplify the tax code and get rid of carveout toes, another big pro-growth policy as long as he's not derailed by some sort o

central gangs, 45 seconds, jay powell, followed the volcker playbook.'t feel like they have got the same results. does that mean they have to press harder or wait for the so-called lag effect? the greatest risk i'm concerned about is the fed overdoing it. >> from my perspective there is no question that the fed has overdone it. the great irony if you listen to speeches coming from fed governors, chris waller in particular he is arguing that the lag effects were shorter, things should have happened faster because they were so forceful and so firm in their conviction around hiking rates. everything i'm seeing says the exact opposite. americans have largely turned out their mortgages. corporations have done a lot of refinancing in 20 and 21. so that means maturity wall doesn't hit until 2024, 2025. all of this basically means that we're only seeing the areas where people have to refinance and are facing the higher rate implications right now. those are the only areas where we're beginning to see the distress. that can manifest itself in a bank run where yo

driver in the savings loan crisis for instance was you saw these big changes under then fed chairman volcker rates went up quite quickly, not as quickly they did this time. i mean, it's in fairness to say the rate increases we've seen under jay powell have been unprecedented in their and because financial institutions hold long but not magnitude not in magnitude. a cigaret but because we ensure citizens have long dated assets like mortgage or mortgage backed securities or treasuries, those assets are highly sensitive to rate changes and. so again, many institutions have that risk. many institutions sell off that risk. but was almost certain, in my view, that to this change in interest rate environment, you were going to something break. and i think it's an open question you know, i certainly raised some of these issues when i still in government with other regulators i expressed concerns the concentration of mortgage backed securities at banks you know and said, listen is going to turn at some point. so it a bit frustrating to see some officials say well, who knew? well, you should have know

i think that is off the table and if we go back to the 1980's, volcker prematurely cut interest rates be room for the fed today to be softer on inflation. but given the history and the mistake that the maid come i do not think the current fed is going to be able to take that chance. rishaad: he cut rates just before we had peak inflation. that is something people are wary of as well. is inflation structurally changed? >> inflation has many components and some components react to main street and some react to fed policy. it is not clear what the balance is between those two forces. i think there are grounds for thinking if you raise interest rates, you actually support inflation in some parts of the components, notably in labor. i do not think we will go into recession, but a very strong labor market and strong wages, which supports the model of a substitution effect between labor and capital. it is a complicated picture. i think the long-term trend in inflation has a flaw to it. the short-term components have a little bit of a respite, some of it coming from softness in the chinese ec

about five years into it, they decided they had to get share full occur -- chair volcker to come to theiring. he is a fly fisherman. jackson hole, this is a major place for people who do that kind of fishing. he brought his buddy, they do fishing together a lot. it got more global, more monetary policy, and broader, and broader. so ultimately over the years, all of a sudden instead of just talking a little bit and welcoming everyone on friday morning who was attending, more of an economic outlook. in more policy-oriented area then one of the big examples of what this put on the map. when ben bernanke in 2010, suddenly signaled when there had been quantitative easing that there might be more. that led to qe2, a strong example of a fed chair using this event to send that signal. that's why it has gotten so important. as for the mood music, you yvonne, there will still be a lot of concern about inflation. will it stay down, will we get more of the higher for longer, all these kinds of things. it is two and a half days. there is dozens of central bankers, there will be a lot of talk going on.

how is this different from the 1970s and early '80s one of the key differences, is paul volcker, runningauses a recession, so be it if you look at their protections, they say three years is just fine the other part of it, the labor market went into covid. the economy rebounded much faster than the labor market did. businesses are at this point, back filling, open positions we think that's going to keep us from tipping over. you have the extra resilience. is the fed done? did today's sales mean they have to do more in there? we don't think so. they did as much as they immediate to do. they will be libdeliberating and sifting through inflation. the data is coming down as fast as we expected it to if we look at the monthly prints, they are slower. they're going in the right direction. we're adding an inflection point. not everything is negative or positive you have data going in different directions >> you're sure, no one expected inpoliceflation to go back up t. you're sure it's not going to pop back up again? if any economist tells you they are sure, you need to walk away. i feel good abo

but a lot of, you know, hard core paul volcker esque central bankers and economists would say, look,sorry, you have to you know, you have to get the economy to slow down in order to bring down inflation. it's still at 6%. do you think what message then is or going to give us seems to me he might be more likely to say, yes, we can see what's happening, but but we're going to keep rates high for longer. do you think this concern about a recession could tilt him a little less hawkish, a little towards the middle, even dovish? i think it will, but not today. i think that's the that's what will possibly come. i think what we're going to see is that there will still be holding the course and remaining of the view or expressing the view that, you know, we're aware that there is softening in place. there's a lot of tightening that's already in there that tightening is going to have a much bigger impact in the second half. so the half of the year that we're in now and in the early parts of 2024, particularly as those mortgages in new zealand, new zealanders have fixed rates of very short term

me his work shows this indicator, core service inflation is falling at the same pace it fell under volckerl slowly from spending and inflation, tomorrow's focus to jobs and wages where the consensus looks for 170,000 jobs and wage gains of 0.3%. atlanta fed president rafael bostic saying overnight from south africa he thinks the fed funds rate is appropriately restricted didn't say sufficiently. appropriate. maybe that's enough. unclear if powell and the rest of the fed have the same idea. but the data the next several days tomorrow, today, could help hone those views becky? >> i'm still trying to think of what those four have in common outside of that. the only thing i can think of is all four of them made a whole lot of money was jeff bezos in new jersey this summer? all three of the other three, oppenheimer, barbie and taylor swift came to new jersey the movie made a lot >> the individual -- >> becky, you're thinking too hard it is very simple. you got it barbenheimer and then you have this prime day in there. look, people were induced to spend because they had a product out there that