Is the Economy Getting Better or Worse? The Fed Says It's Hard to Tell

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• 00:05

  Yesterday,

• 00:06

  the Federal Reserve announced that it was cutting interest rates again by a quarter of a point.

• 00:11

  But big whoop.

• 00:13

  Everybody knew that was coming.

• 00:15

  What people are really dying to know is what the Fed will do next.

• 00:20

  Interest rate policy isn't just about what the Fed does at the meeting.

• 00:25

  They cut interest rates or they raise interest rates.

• 00:27

  That's our chief economics correspondent, Nick Timmeros.

• 00:30

  It's about what they say is the most likely path forward.

• 00:35

  Markets price that in.

• 00:36

  The bond market reacts to that.

• 00:38

  Financial conditions change because of what they expect the Fed to do.

• 00:43

  Nick, it seems like every time we have you on the show,

• 00:45

  you come up with a very useful metaphor for what is going on at the Fed.

• 00:49

  So what is the metaphor that you have for us today?

• 00:53

  Well, so the metaphor I would use is the one that Jay Powell, the Fed Chair, used yesterday.

• 01:00

  They are driving in the fog right now because of this data blackout that resulted from the government shutdown.

• 01:09

  You could imagine that what do you do if you're driving in the fog?

• 01:13

  You slow down.

• 01:14

  So that could or could not.

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