By coinnews 
00:00 Speaker A
Just your immediate response and reaction to the Fed decision here, Luke.
00:05 Luke
Yeah, I think the the decision is as expected. No movement in rates, of course, and then also acknowledging the risks for higher employment and higher inflation. And it’s not that much of a surprise on the day, but I think if we look back to January 1 of the year, the biggest change has been from at that point, a lot of people were just viewing tariffs as having this upside inflation risk and that the Fed might even have to hike. But as we’ve gone through the first four months of the year and seen that consumers are not nearly as strong as that common narrative on January 1, uh, that, um, that it really poses a risk to growth. So I think at the beginning of the year, people were much more worried about, uh, the Fed needing to hike because of those inflation pressures, but now it’s clear, uh, that there’s a little bit of a tug of war going on here between the risk of higher inflation and and weaker growth. We think that weaker growth would ultimately, uh, win out, that that would be the stronger force. You know, there might be some higher prices in the near term, but, uh, but this is likely to cause a recession if tariffs stay as they are, and we think the Fed would end up cutting later this year even if they’re not communicating that now.
02:05 Speaker A
Michael Roney, I’m going to bring you into this as well. Um, to me, this statement stands out, this line stands out from the statement, uncertainty about the economic outlook has increased further. Not that that is news to any of us, right? If we I mean, I’m sure you’ve been listening to a lot of conference calls this earning season and uncertainty remains the word of the day. But if uncertainty is the word of the day, how does the Fed do its job? How do you all do your jobs in terms of figuring how how to manage portfolios?
03:08 Michael Roney
So, Julie, I think there is a small window of opportunity on a number of fronts. One is monetary policy and to begin to ease monetary policy in advance of what could be a difficult summer and third quarter. Yet the Fed has chosen today to at least take a pass on that. Certainly the second component of this is if the Trump administration continues to pursue aggressively deregulation, the tax bill and other pro growth policies. That’s ongoing, but will take a while. Certainly have the tariff and trade negotiations, but boy, there seems to be a lot of back and forth on this, and the window is closing. And then finally, earnings. They are good, and maybe through the continuation of a decent earnings environment, you might be able to kind of avoid recession. But I guess the message I I’m I’m trying to deliver here is that this window is getting smaller and smaller, and soon the hard data will confirm what we already see in the soft data. Hasn’t yet, but that’s the fear.