The Fed Chair Said What?

The Dividend Cafe

The Dividend Cafe - The Bahnsen Group

Monetary Policy, Dividend Growth Investing, Investing, Wealth Management, Estate Planning, Retirement Planning, Business, Macro Economics

4.9 • 572 Ratings

🗓️ 27 October 2023

⏱️ 22 minutes

🔗️ Recording | iTunes | RSS

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Summary

Today's Post -

I closed out our annual “money manager due diligence week” last week with a luncheon put on by the Economic Club of New York with Federal Reserve chair, Jerome Powell. He surprised me by saying some things that I was not expecting, and he also said a lot that I could have predicted verbatim (okay, I did predict verbatim) before the speech.

But despite all my earnest desire that the main action in markets let alone the economy not be at the whim of a few unelected academics, the Fed is the major story of markets right now. Their propensity to stay way too loose for way too long followed by a period of being way too tight for way too long is the cyclical and rotational story of our economic and market-oriented experience for 25 years.

We met with nearly twenty money managers last week (across a wide variety of asset classes in both private and public markets). We did not meet with a single one who did not bring up the Fed, the state of monetary policy, the potential direction of monetary policy, and its impact on how they think (and in some cases act).

So let’s jump into the Dividend Cafe where today is all about the Fed, the rubber chicken, and the radicals who stormed the stage before the speech began. Well, actually, we spend very little time talking about the rubber chicken or the people who stormed the stage and delayed the event for fifteen minutes while security and law enforcement did their thing. Those things really happened and were quite upsetting (especially the chicken). But the Dividend Cafe today is all about the actual words of Jerome Powell and what it all means. Off we go.

Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com

Transcript

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0:00.0	Welcome to the Dividing Cafe, weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life.
0:12.5	Well, hello and welcome to this week's Dividend Cafe. We are getting very close to the end of the month of October.
0:18.9	We actually have a couple market days left in
0:21.6	October next week. But in the meantime, my team is fresh off of our annual retreat, the entire
0:29.7	company, all seven offices of people embarked upon Newport Beach, California the last couple of days.
0:37.0	I, myself, am heading back to New York City.
0:40.2	And in the meantime, I wanted to devote today's time in the Dividend Cafe to the luncheon
0:47.5	I attended last week with Fed Chair Jerome Powell. There were some takeaways and an overall, I guess both the basic premises from
0:58.9	which he's operating and some of the conclusions that he shared, how that might affect our
1:03.9	thinking, I thought the whole sort of A to Z of his talk was worth recapping and building a dividend cafe around.
1:12.9	I want to start by saying that the food was terrible and that the people who stormed the
1:19.8	stage caused security to have to rush the Fed chair out to the back stage and get him out of harm's way while they did their whole
1:29.9	little spiel forcing a whole bunch of police and guns and security and everything that I don't
1:37.5	think that they got a lot done. I thought it was maybe a little ineffective for their cause.
1:47.7	But nevertheless, it was an experience to be there witnessing it from not all too far away and more than a nuisance and anything
1:54.0	else. So if you did catch that on the news, it was most certainly true. There's a picture of the whole
2:00.7	thing in the dividend cafeendon Cafe today.
2:03.4	But yes, myself and Brian Saitel and Kenny Molina, our collaborative investment committee here at the Bonson Group, we were all there in person watching the drama.
2:14.0	Fed Chair Powell is an interesting person. I should point out that he's one of the first and only Fed chairs we've ever had with capital markets experience.
2:25.6	He worked at the private equity behemoth Carlisle for quite some time.
2:30.7	And he was on the Federal Reserve Board in the Federal Open Market Committee in 2012.
2:39.2	At the time, the Fed chair was Ben Bernanke, and he had proposed the idea of a third round of quantitative easing,
	...

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