Mixed Signals on Rates Should Be Expected, Former Fed Governor Tarullo Says

The transcript discusses the Federal Open Market Committee (FOMC) meeting, highlighting the challenges of summarizing diverse opinions and the evolving views of Chairman Powell. It emphasizes the importance of a coherent narrative from the Federal Reserve to guide policies and market expectations. The discussion also covers the risks of being bound by a fixed narrative and the impact of the government shutdown on economic data and performance. The need for flexibility in response to new data and the potential effects of prolonged shutdowns on the economy are also explored.

What are the potential dangers of adhering too rigidly to a narrative in economic policy?

How does the government shutdown impact the Fed's access to economic data?

What role do second-order effects play in economic modeling according to the discussion?