• Companies want some consistency
• Leaders have to put pencils down because of so much change
• A 50% EU tariff is an order of magnitude different from current situation
• Tariff rates that high would be scary for the suppl;y chain
• There is anxiety among firms that continued tariff announcements would disrupt the supply chain and lead to rising price environment.
• In the short run the Fed needs to wait for the dust to clear, the bar for action is higher until that happens.
• If tariffs have a stagflationary impact then that is the central banks worse situation
• My fear is the data comes out with a lag, so something may have already happened. Upcoming reports may show a more serious impact from actions already taken.
• The market determines the long end of yields. We should take into consideration the impact from that impact on the economy.
• Our job is to look at anything that affects prices and employment
• Interest rates are still within historical ranges, if there is a crisis over US fiscal stability they would be moving higher.
• ON April 2, I thought rates could come down by the end of the year.
• That might be extended out 10-16 months from now.
• Still feel that underneath the volatility, the economy remains strong, if tariffs and uncertainty were not a threat to inflation, rates would eventually fall.

What is the Fed to do, but wait given the fiscal side of the equation is easing and tightening on a daily basis. Yes trade policy is 11% of the economy but the impact can be a multiple of that 11% if the apple cart is more than wobbling and it has ancillary impacts.

Risk managers look to define and limit risk, and then accept risk. That does not mean not take risk, it just says they define and limit it as much as possible.

What Goolsbee and the Fed members are saying is risk to inflation and employment can not be defined. It cannot be limited. So sit tight until the dust settles.