AI Summary
5 min readThe Federal Reserve meets tomorrow and Wednesday, and the bond market is already signaling its verdict. The ten-year Treasury note topped five percent this morning, the thirty-year hit roughly 5.3 percent, and markets are pricing in a ninety percent probability of a rate hike. But Wendy Edelberg, a senior fellow at Brookings, puts the odds closer to a coin flip. She argues the Fed could make a case for standing pat—and that case rests on data the committee doesn't yet have in hand but knows is coming.
The Fed's impossible choice
Kevin Warsh, the Fed chair, is in a tight spot. He has to choose between disappointing markets if he doesn't raise rates, or disappointing the president who appointed him if he does. Edelberg notes that Warsh had talked before taking the job about wanting tighter financial conditions, and he has gotten them. Markets have already done some of the Fed's work for it. That could let him argue that no rate hike is needed.
Continue reading the full summary in the app — free to try.
Read Full Summary →Free • No credit card required
Never miss an episode of Marketplace
Get every new episode summarized in your inbox — free, ~5 minutes to read.
No spam. Unsubscribe anytime.
What you'll learn
- 1 (01:10) **Opening: The week ahead** - Kai Ryssdal sets the table for a big week in the economy, noting rising borrowing costs, energy costs, and inflation.
- 2 (01:55) **Wendy Edelberg: "Policy is doing its best to derail it"** - Edelberg argues the economy is resilient but under serious threat from Trump administration policies.
- 3 (04:23) **Previewing the Fed meeting: A coin flip on a rate hike** - Edelberg channels Fed Chair Kevin Warsh, arguing he has a tough choice between disappointing markets or the president.
- 4 (08:03) **Global central banks: A cast of hawks** - Marketplace's Mitchell Hartman explains that the Fed is not alone in its hawkish turn, with the ECB, Bank of Japan, and Bank of England all moving toward or holding higher rates.
- 5 (10:52) **The dollar's resilience: "The least worst" currency** - Stephanie Hughes reports on why the dollar is rising despite U.S. economic blows.
- 6 (13:22) **The subscription economy: A lifetime of payments** - Christian Schwab reports on how debt and subscriptions are replacing ownership for many Americans.
- 7 (15:18) **The history of installment credit: From leveler to trap** - Historian Louis Hyman contrasts the 1920s installment credit boom, which gave ordinary people access to expensive goods, with today's model.
+ Full timestamped outline available in the app
Guests on this episode
Show Notes
At this week’s FOMC meeting, it’s likely Fed governors will hike interest rates. They won’t be alone. The EU raised rates last week and Japan is expected to do the same at its upcoming meeting. These central bankers are all dealing with similar inflationary pressures, and hawkish rate-setters stick together. Also in this episode: The U.S. dollar rises in anticipation of a rate hike, diesel prices break records, the subscription-BNPL-rental economy reduces how much we really own.
Every story has an economic angle. Want some in your inbox? Subscribe to our daily or weekly newsletter.
Marketplace is more than a radio show. Check out our original reporting and financial literacy content at marketplace.org — and consider making an investment in our future.
Read the stories in today’s episode:
More from this podcast
Marketplace →