“When Powell was chosen as Fed chair, I was a bit skeptical,” he said. “Not saying he isn’t really smart, but he is an attorney by trade. I believe that the Fed chair should be a finance guy. My beef is more with the Fed board in general. The reports that we use are antiquated. Case in point is the “owners’ equivalent rent” stat that is used in the inflation reports. The average homeowner has no idea what their home would rent for, and it is a totally bogus number.
“The Fed always looks in the rear-view mirror and is not very good at looking forward. While I am not all in for Warsh, I am very interested in what he will bring to the Fed. He has a very different perspective on the economy and the Fed’s role.”
Glen Weinberg of Fairview Commercial Lending told our Fergal McAlinden that he didn’t expect a rate move today, and he doesn’t think a new Fed chair is going to change things much.
“I would have been very surprised if they moved on rates one way or another,” Weinberg told Mortgage Professional America. “There is no impetus to do anything based on the current data. I don’t foresee many, if any, cuts as the economy seems to be holding up, and inflation is also holding steady.
“On top of that, the budget deficit is continuing to run high, which will ultimately keep longer-term rates higher. I don’t think the rest of the Federal Reserve board has an appetite for much in the way of cuts, as the threat of inflation and stagflation is real.”