Yesterday we asked the number #1 question in Real Estate and Mortgage lending, “What are interest rates going to do?” We mentioned that the only sure thing is the meeting will happen, and the Federal Reserve will let the world know at 2PM Wednesday September 17th.
The Federal Reserve
There will be lots of Fed Speak, Jackson Hole. Half of the Federal Reserve Governors will speak this week and next with the main event Friday at 10 AM EST Jerome Powell.
We received the Fed Minutes from the last meeting that shows they are worried about the labor market and inflation, which are their dual mandates. Most of the Governors agreed it was too soon to lower rates. Even though two Governors argued in favor of a cut. It was the first time that multiple Governors voted against the rate decision in over three decades!
Good news and Bad news
Bad news
Tariffs were a focus at the meeting. They see the “upside risk” to inflation from tariffs and “considerable uncertainty” the impact of tariffs will have. The reason for continued Pause.
Good news
Sadly, the meeting happened 2 days before the BLS July Jobs report fiasco! That report showed job growth was weaker than expected. It also had massive lower revisions to the June and May Report. (BLS You’re FIRED!) That “downside risk” to a weakening labor market could be enough to lower rates.
The Federal Reserve Board
Who’s who, how are they leaning and who is in trouble!
The Federal reserve is made up of 12 regional Governors. Right now, we only have 11. We are waiting for a nominee to be approved. Since the last meeting here is how they are leaning. Based on public comments and votes, this next meeting could turn into a new Realty show The Real Fed Governors of the Reserve!
Who could vote NO
Jerome Powell, Susan Collins, Alberto Musalem, Jeffrey Scmid
Who are open to a rate cut
Christopher Waller, Michelle Bowman, Lisa Cook, John Williams
Who are undecided Governors
Michael Barr, Austin Goolsbee, Philip Jefferson
Who is in trouble with the law
Lisa Cook. Allegedly Governor Cook committed mortgage fraud. FHFA Director Bill Pulte alleges that Cook claimed 2 properties as her primary residence at the same time. He has referred this to the Department of Justice. He and the President are demanding she resign. The President is demanding Powell Fire her. The law states that only the President has the power to remove a board member, for just cause only.
Who knew economics could be this exciting! Stay tuned for Monday’s installment of
WHAT AR INTEREST RATES GOING TO DO? When you find out about Jackson Hole speeches and some insight into what and ifs of the Federal Reserve Board decision.
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