Consumers are still spending, but with cracks in other parts of the economy, what is the Fed going to do?

From American public media, this is Marketplace.

In Washington, D.C., I'm Kimberly Adams in for Kyra's doll.

It's Tuesday, September 16th. Good to have you along.

Today marks the start of what has to be one of the more awkward Fed meetings in recent memory.

New Fed Governor Stephen Myron joined the Federal Open Market Committee today, despite the unprecedented fact that he's taking that seat without

officially resigning his position at the White House. He's taking a leave of absence. In the same

room is fellow Fed Governor Lisa Cook, the person Myron's former slash current boss, President Trump,

is trying to fire. Even with all the drama over Fed independence we've seen these past few months,

not to mention the tariffs and the national debt and sticky inflation and souring jobs numbers,

the stock market doesn't seem to care all that much.

Marketplaces Matt Levin explains why.

Economist David Kelly at J.P. Morgan Asset Management says if the Fed lowers rates tomorrow,

it'll be more about politics than monetary policy.

I think they are cutting rates because they know how much pressure they're getting from the administration,

and how much more pressure they'd get if they didn't cut rates.

To be clear, a lot of experts think a rate cut is the right move.

But the specter of eroding Fed independence has people freaking out about the economy's long-run health,

to which the record-setting Dow Jones or S&P 500 says, who cares about the long run?

In the short run, low interest rates means that asset prices can go higher. And so people are bidding up

the asset prices, knowing that what the Federal Reserve is doing may be creating a bubble in the

future. But for right now, the market is partying and everybody must be part of the party.

...