The battle is over inflation vs jobs, two vastly different opinions. 
Fed governor Stephen Miran was a senior White House adviser until his confirmation to the central bank board on September 15.
Miran replaced Adriana Kugler as a member of the Federal Reserve Board of Governors when she unexpectedly resigned in August.
Fed’s Miran Argues Steep Rate Cuts Are Needed
Please consider Fed’s Miran Argues Steep Rate Cuts Are Needed
In his first speech as a member of the central bank, Federal Reserve Governor Stephen Miran argued that significant interest-rate cuts are needed to avoid unnecessary damage to the labor market, backing demands from President Trump that the Fed pull rates sharply lower.
“I believe the appropriate fed funds rate is in the mid-2 percent area, almost 2 percentage points lower than current policy,” Miran said. On Friday, he claimed credit for a projection last week—as part of the Fed’s dot plot—that interest rates should fall another 1.25 percentage points before the end of the year.
Miran’s views are likely to meet resistance from many of his colleagues on the Fed’s policy committee who remain more concerned than he is about inflation. Earlier Monday, St. Louis Fed President Alberto Musalem said he believes interest rates are less than modestly restrictive after the Fed’s cut last week, signaling he will be cautious about supporting further cuts.
Miran’s contrary view draws heavily on an academic approach to setting interest rates, popularized by John Taylor, a Stanford University professor. The “Taylor rule” approach calculates an appropriate interest rate using a formula that weighs economic variables. Miran said that on the surface, the Taylor rule suggests that the Fed’s current interest-rate stance is nearly on target. But he argued that recent policy changes—which also include regulatory and tax reforms—have reshaped the economy in ways that aren’t yet obvious to standard interest-rate models.
“Instead, I suspect existing backward-looking estimates are too high because they insufficiently account for recent changes to fiscal and border policies,” Miran said.
Meanwhile, at the Atlanta Fed
The Wall Street Journal reports Fed’s Bostic Sees Little Reason to Cut Rates Further for Now
Bostic said in an interview that he penciled in only one rate cut for all of 2025 at the Federal Reserve’s meeting last week. Because officials cut rates last week, that suggests Bostic doesn’t currently anticipate the need for another reduction at either of the two meetings remaining this year.
He said he had filled out those submissions “with a very light pencil,” underscoring low conviction over the right path for rates, but he said he remains more nervous about inflation continuing to run above the Fed’s 2% goal.
“I am concerned about the inflation that has been too high for a long time,” Bostic said. “And so I today would not be moving or in favor of it, but we’ll see what happens.” The Fed’s next meeting is Oct. 28-29.
Bostic doesn’t believe that “the labor market is in crisis right now,” he said. “It’s an open question about exactly how weak it is.”
Bostic said tariff-driven cost increases have been more muted than initially projected in part because businesses have used various strategies that are spreading out or delaying the pass-through to consumers. Those buffers could be exhausted over the coming months. In that case, the economy might avoid a much-feared immediate run-up in prices but instead endure a longer period of moderate price pressures.
“The full story has not been told in terms of how the change in their cost basis is going to reveal itself into the final goods process,” he said.
I side with Bostic on tariffs and inflation, but not jobs.
I side with Miran on nothing.
Strike that. I agree with Miran on this: ” Recent policy changes—which also include regulatory and tax reforms—have reshaped the economy in ways that aren’t yet obvious to standard interest-rate models.”
Yes, in favor of bigger deficits and higher inflation.
The argument for lower rates is that Trump will have crushed the economy so hard that demand collapses supporting lower rates.
Related Posts
June 25, 2025: Trump Says Powell Has “Low IQ”, Mentions 3 or 4 Possible Replacements
Trump is on a very foolish mission to “Pack the Fed”.
September 11, 2025: CPI Provides No Reason for Fed to Cut Interest Rates, It Will Anyway
The CPI was higher than expected in August, but the Fed will do what it wants to do.
September 17, 2025: Fed Cuts Interest Rates 1/4 Point, Trump’s New Fed Lapdog Dissents
Stephen Miran, Trump’s new appointee voted for a 1/2 point cut.
September 17, 2025: The Fed’s Interest Rate Projections and Trump’s Demands Are Light Years Apart
The Fed is quite undecided where interest rates should be. Trump isn’t.
Finally, please see Fed Notes “Challenging and Unusual” Setup on Unemployment and Inflation
Powell says risks to inflation are to the upside. Risks to labor market are to the downside.
Powell has this correct, but the Fed is hugely to blame for how we got here.
These two individuals exhibit the product of Central Bank monetary government, opposed to the free market.
Miran wants FFR at 2.75 percent, the current rate of inflation, or effective ZIRP. ZIRP was the easy monetary policy throughout Obama’s “new path forward” economy. In Bessent’s essay, ZIRP benefited the wealthy at the inflationary burden of the lower economic tier. Low FFR allows wealthy brokers to arbitrage yields on equities and long-term Treasuries. This was the design behind low rate BTFP loans based on Powell’s proposed 6 quarter point rate cuts in the future. Powell currently has made 5. Low FFR becomes a back-door QE, a result of arbitraging long Treasuries, although a tenuous influence. Miran is a monetary socialist shill for the wealthy broker class that wants a return to the (inflationary) easy money of the last decade.
On the other side is Bostic, who lost his Fed voting status after his third infraction for insider trading. Although minor, it demonstrates Bostic’s lack of attention. Fed members that violate Fed policies retire early to spend time with family. Bostic is kept on as Fed hand puppet. Bostic’s voting right was given to Mary Daly, as reward for her failure to monitor SVB, a commuting distance from her home. SVB failed with a portfolio of Treasuries that yielded 2.5 percent, slightly less than Miran’s desired FFR. Daly has been the most liberal member of the Fed. A proponent of “sustained period of moderately above-target inflation”. Daly’s yearly Fed salary is almost half million, which explains her quote “I don’t feel the pain of inflation anymore. I see prices rising but I have enough… I sometimes balk at the price of things, but I don’t find myself in a space where I have to make tradeoffs because I have enough, and many Americans have enough.” Though a superficial defender of the lower class, this former bridge dweller has more in common with Miran, in their tone-deaf disregard for inflationary burdens of low rate policies.
If Us is on recession,then inflation drops down a little.You need to drop the rates to have better negative real rates.
Isn’t the paradigm stocks don’t do well in times of inflation? Has that now changed?
After the end of WWII we fed Europe. From the highs of 1949 gold reserves fell from 700 million oz to 510 million oz in 1960 and to 395 million oz in 1965. While losing our gold reserves we became the first superstate. The Dow popped up from 150 in 1949 to 1,000 in 1966. JP will not raid bank accounts or confiscate gold, bc RE will not plunge to the 2010/2012 bottom. The Fed constricts supply before the boomers die. RE will decay for years in real terms, while the banks finance onshore industrial hubs and satellites.
Embrace Modern MonetaryTheory. It won’t hurt. It’s literally all that is left. The alternatives have sunk and are lying at the bottom of the Mariana Trench.
= gold 3800$
basically it is over!! investors called trump/USA gov bluff – Ukraine, Israel, Venezuela, maga ,
IN OTHER WORDS – DEFICIT SPENDING!!!!!!
======
NOTHING WILL CHANGE, NOTHING WILL BE CHANGED.
IT IS $2 TRLN DEFICIT, NEXT 2.5 TLRN$, NEXT 3 TRLN
=====
w-in 2-3 years: panic, bank accounts freezing, SS cuts, gold confiscation, etc
be warned!!!!
alx
ps
brush up on Weimar memoirs, books
The former colonial states declared a Palestinian State, but first Hamas has to go. Bibi can keep Hamas alive for months or years. Meanwhile centrifugal forces are breaking Europe apart. The cancer is spreading. The EU has to decide: a phony AI freedom or an iron fist. While Macron and Starmer masturbate, before the next Israeli election, Bibi will annex the Jordan Valley. Qatar, MBS the EU and the US will feed Jasa and the west Bank. After a decade or two the Palestinian entity and Israel will be united.
Once again Trumps tariffs have damaged our farmers ability to sell their products profitably on the global markets. During trumps first term $80 billion in emergency subsidies. Only 9 months into TACO’s second term $50 billion is heading out the door ~ and it will only get worse!
The same farmers that voted for this idiot are being bankrupted by him.
Elections have consequences.
And for those following or trading the gold market?
Futures options expire/settle on the 25th of September and gold often gets “Bitch Slapped” as settlement occurs.
Unless of course contract holders “Stand for delivery”.
Expect significant volatility in the Gold market as the December contract is huge for delivery and settles on Nov 24th.
Let the musical chairs game begin!
And in the little hours gold has quietly gone over the $3,800 level on high relative volume. How far can this go?
Shhhhhhhh!
😉
Got mining shares?
It’s just getting started Frosty. They will have it climb until They are comfortable with the number, and then Await the crowd reaction.
Like with every other investment strategy, a sell number is/should always being looked at. You invest for profit, and whether it’s silver, gold, or tulip bulbs, there is always a point where you eye for a sell off. Typically when it’s much higher than when you invested, for maximum profit obviously.
The fear with Gold, is when it starts to sell, it wakes people up big time! They don’t want to miss out, and with Gold it’s typically large sell offs for profit, due to the “Gold Rush” as some would refer to it as.
Gold is also a much held investment and by many, so fluctuations occur all the time, but typically slower during buying times, you must part with money/assets to do so. During the sell times however, Big Chunks can go for Big Money and that’s the rub on sell, sell, sell signals occurring all over the place.
I would suggest it will take a few more months before the sell signal occurs, but it’s coming according to History, and it’s coming due to the Need For Cash!!! This will take some time, start to develop, and then all at once.
I would strongly suggest right before the mid-terms, to gather the biggest bang for the buck so to speak. Many will be flush with cash, as gold gets its long awaited sell off, and the ROI will be massive!! Investors will be giddy, along with the Government IMO.
You are a shill for the banks, the Fed and the government.
You are advocating that attaining fake and illegal fiat Federal Reserve Notes (which are NOT lawful money according to Article 1, Section 10 of the US Constitution). Intentionally bad advice. Knowing that the next phase of our monetary calamity is the annihilation of the current fiat currencies and the system they prop up.
Note to self: Frosty and Stu are shills promoting the current system created by globalist bankers wearing small hats
The POTUS, CONUS and the SCOTUS are TRAITORS that belong in jail since they are violating every day the very Constitution they swore to uphold and protect.
I would advise against buying mining shares. They are liable to be taxed into oblivion or nationalized (confiscated).
Just get the fungible stuff without counterparty risk. And the numismatics for their beauty and history.
Mining shares are to risky.Physical gold does about the same good job.
Not enough gold and silver for everybody following the new US banks recomandations:20 % of your portfolio.Nobody is selling,everybody wants to buy.
This is what happens when you create to much debt:people lose faith and turn on precious metals.
The farmers will suffer, but stay loyal to Trump.
They always do.
“Smart people don’t like me” – donald trump
They won’t turn woke!
When they actually bought into the moronic claim the liberals were going to declare a tractor tire rut full of rainwater to be a protected wetland, I washed my hands of them. They elected a governor who in a fit of rage shot her puppy to death. She should be one of the most hated people on the face of the earth. I shot a dog once. It had rabies. Zero empathy for them. May their pesticides transition all their boys into girls who want to date RFK Jr.
I would take no inflation over employment. If given the choice. Inflation hits everyone. Jobs only count if you lose it.
Yeah i know its more complicated than that.
Plus job loss is self-resolving. Eventually the market readjusts and employers re-hire…just at lower levels of pay due to the newfound labor surplus.
To me it’s actually not more complicated than that. Inflation impacts everyone, some more than others. Inflation as Mish has proven with past posts benefits the already wealthy and those with access to first money, asset holders, the lot more so than others. Unemployment impacts the general economy but mostly those that lost their job. When I was unemployed my brother was not immediately and directly impacted unlike when grocery or home prices rise. The Fed’s primary mandate should be price stability and by stability I don’t mean constantly rising x% where x is a fictional number proposed the Them. Given they’ve chosen 2 which one might argue is a demographic based number that actually should now be lower, not higher given demographics, they’ve been nowhere near that number for years now. And that’s with subtracting off large segments of prices that inconveniently would cause the official number to exceed x by a large amount.
To CaptainCaveman’s point employment can correct in various ways. If governments keep printing with the Fed’s artificially low interest rate, inflation will persist and I cannot refuse to buy groceries, a home, health care, a vehicle, gas, insurance, etc.
The theory is that if the Fed lowers rates, that will help the economy. And while that may be true, the effect on the economy pales compared to the effect on stock markets. Just the expectation that the Fed is about to cut rates many times is boosting the markets, while the economy itself flounders.
In the era of AI it is possible for the stock market to go to infinity and unemployment to go up. They can cut rates but it won’t do anything IMHO opinion until they get down to 1%
The dollar index is at its lowest point YTD year period in a long, long time. Money is still being created too quickly. The only answer, imo is to stop putting money into the money supply. The world is awash in paper currency, and it has led to inflation everywhere.
This is the longest time period the world has not had multiple currency failures in any major currency. You could say capital markets have done their job or you could also think that central banks have gone crazy. You would be right on both counts. The world is awash in debt and money.
The Trump sycophant wants higher rates… What a surprise!
Today gold hit $3,780 and is looking like the parabolic increase has no resistance.
Got gold mining shares?
Got a little gold just in case the game of musical chairs comes to a screeching halt?
3800$ 1 hour ago.
Pretty sure CraigScottLeboo or whatever his name is has indicated that dictator Trump wants lower rates.
Hint: Trump, like all Presidents, wants lower rates, not higher.
Bostic is the only thoughtful, sane, level-headed, non-political Fed governor left on the FOMC.
The Fed has learned the way to prevent a deflationary depression is by creating an inflationary depression.
Stagflation
Not that I disagree with the notion that deficits are set to continue Mish, but, a serious question for you (and those that have your view that deficits cause higher inflation).
We have had growing deficits and debt since 1980, with a short reprieve in the late 90’s. Then deficits and debt exploding with wars, financial crises, and a global pandemic.
But, inflation fell for all of that period until after the pandemic.
My contention always was, that it wasn’t the overspending by government that caused the inflation, but, rather the screwed up supply chains, limiting supply of goods, while money was available due to the government largess.
But, you seem to imply that it’s just the deficits that cause the inflation. If that was the case, why didn’t we have exploding inflation from 1980 until 2020?
Inflation fell? Rates of change may have fallen but prices have risen unabated, using the Fed’s favored PCE indicator, from 1959 until present save for VERY few instances: a couple months around 2001 recession, ~6 months during GFC and a couple months at start of pandemic. In all cases they quickly and unrelentingly continued onward and upward. With productivity increases and access to inexpensive overseas supplies we should have seen far more periods of price stability or decreases yet did not.
Using CPI numbers, annualized rates have been negative (prices went down .POINT 4%) one time since 1956, that would be during the biggest non-covid financial drawdown in my lifetime 2008/9. Once!
And that’s with them undercounting/undererporting inflation numbers. Imagine the actual level.
The desire to keep asset prices inflated while also not counting them in the official numbers is the most galling thing they do. Despite innovation and productivity gains we haven’t seen a period where prices didn’t rise.
For 2024, Federal spending was about $7 trillion with $2 trillion of that being borrowed money.
Imagine if instead of borrowing the $2 trillion that the government increased taxes by $2 trillion. That would have taken away $2 trillion of taxpayer spending and replaced it with $2 trillion of government spending. The effect on inflation in that case would probably be neutral.
Deficit spending is inherently inflationary because it is spending that would not have occurred had it not been borrowed and federal spending has a widespread effect throughout the economy (federal salaries, SS benefits, etc.).
Because the 60 year interest rate cycle topped in the early 1980’s and was heading toward its cycle low. The bottom was ripe to happen, but history will credit COVID as causing the bottom. Now that the low is in, the next 60 year interest rate peak is expected around 2040.
“But, inflation fell for all of that period until after the pandemic.”
how are you measuring inflation?
Any way you want, but, let’s just use the CPI. According to FRED it was 15.8 in 1980, 5.0 in 1990, 2.7 in 2000, 0.74 in 2010, and 2.6 in 2020. Over course I’m not saying that prices actually went down, but, the rate of inflation pretty much fell from 15 percent in 1980 to as low as almost 0 in 2010, and back up to 2.6 percent right before the pandemic. So, falling al that time that deficits and debt were exploding.
https://fred.stlouisfed.org/series/CORESTICKM159SFRBATL
= inflation fell for all of that period until after the pandemic.
inflation is up-.dwn nominal prices
what is important; PURCHASING POWER!
CHECK OUT new cars/new homes chart – 10 *20 30 years
it is in toilet last 10*15 years!
China
If Miran wants lower rates, he should quit the public pronouncements. It probably just makes the other Fed members more resolved to keep rates unchanged so they don’t look cowed by Trump. Same with Trump. If he wants lower rates, he should STFU, but he can’t.
Besides, shouldn’t both Miran and Bostic wait for more data? PCE (Personal Consumption Expenditures) report comes out on Friday.
Have any of the Fed governors taken a look at equity prices?
Miran is nothing more than a mouthpiece for taco with the task of convincing other members of the fed to vote for the wrong policy. The good news is his ranting had no impact on the other members of the fed.
I have been following Jeff Snider on rates and how they do NOTHING for us other than create the illusion of stability.
Gold made a new all time high. SPX might cross 6,700 this week. There are no reasons to cut rates. Speculators can’t make a crisis. They can only seek protection, or profit, if they think one is coming. If it comes JP, Bostic and Alberto Musalem will rush to cut rates.
“ There are no reasons to cut rates.”
Why the change in attitude? You said rate cuts were going to cut the debt.
The “Taylor rule” approach calculates an appropriate interest rate using a formula that weighs economic variables.
Sounds good to me. I’d prefer something definitive than what we have now: Data driven Fed. Granted, they probably publish the data somewhere outside of dot plots, but I would welcome a more defined & transparent approach with just enough wiggle room for them to slow down or speed up.
The 4-week moving average of continued claims continues its nearly 3-month decline. As such there’s not obvious signs yet that the labor market is nearing the cliff.
4-Week Moving Average of Continued Claims (Insured Unemployment) (CC4WSA) | FRED | St. Louis Fed
Thanks for posting the link. You should do that more often. Actual data is better than wishful thinking.
Continuing claims have indeed declined over the last 3 months. Though they rose for the first 6 months of the year and are still much higher year to date.
Please keep posting this monthly so we can see the direction going forward.
Miran doesn’t want anything more than he wants to perform five acts of fellatio on the President. Could it be more obvious?
peach fuzz would be a worthy descriptor.
fuzzy nuts is what I meant to say. How many cycles has the man lived and seen? Not many.
Inflation hurts everyone but the upper 10%. Lack of jobs hurts the unemployed, maybe 5 to 10%. We could have jobs and no inflation if we didn’t have so much debt.
If the richest 10% can keep the people dumb enough by defunding public education and making them all into nationalistic idiots, then the proles will never figure out their ‘saviors’ are in fact their abusers. This is the way