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the fed's latest policy meeting begins today as we've talked about our next guest says that he sees no rate hike tomorrow but he does expect a pretty hawkish summary of economic projections or the Dot Plot I want to bring in Jeremy Siegel he is the professor emeritus of Finance and Jeremy let's just talk about this even if they're hawkish in their commentary you don't really think that they should or very likely will raise rates again is that right well there's certainly a lot of uncertainties with the strike with uh shutdown of the government and actually political calculations uh you know uh is one one increase or two increases is that the straw that's going to break the camel's back um uh you know I I I I really think that the political calculus is that they should not raise it again I mean if you'd ask the American public I think today the average worker uh do you want to squeeze a point or two off of super core inflation you know which is what uh Jay Paul looks at now over the next two years or do you want a million and a half to two million more unemployed I think they would say Hey listen yeah I I don't want any recession so you know but they're going to talk they have to talk hawkish being being the central bank I think you're going to see The Dot Plot being hawkish I think they're going to push those rate Cuts you know back now they don't know when that really is going to happen people think oh they have an idea about you know what the economy is going to look like in 2024 they really really don't but you know given the strength of the economy and that's what the stock market loves you know that's why even when we have a slightly hotter PP High slightly higher hotter CPI if we got good uh you know real economic daddy in there you see the stock market rally and that's why I think we could still have a firm not a surging but a firm the equity Market through the end of the year if if there are some people who think that they're going to have to cut rates sooner rather than later later this year early next year if that's the case though versus the nine or ten months that most people are anticipating these rates will stay at these levels it's going to be because something bad happened the economy looks worse than anticipated there's a credit problem something blows up in the banking system unemployment drops more rapidly would you agree with that assessment at least that if we get lower rates sooner it's not going to be because it's a good scenario uh absolutely the only really I think the only thing that is gonna really push them to lower rates is that unemployment rate going up a big slowing in an employment picture you know heading into an election year wow I mean think about the impact of a recession and what's going to happen politically in 2024 I mean that that has to come front and center and and by the way as we all know the FED has a dual mandate it has a mandate for employment and inflation and one is not above the other and that's in contrast to most other central banks where they only have that inflation mandate so you know but people can definitely give it most fed heads will get around that by saying yes we may have two mandates but if you don't take care of the first mandate which is inflation management then your second mandate can't be taken care of either that that's a it's it goes yes that's what Paul's saying but it's a question of time do you want to you know if you really want to slam the economy to get that core rate down to two really quickly it's going to go down to two so if it takes another six months another year uh you know again it's all a matter of trade-offs and by the way you know as we all know you know are they going to get it all the way down to two you know there's so much debate about even before uh the recent inflation about given the low interest rates that we've had you you may want in a three percent inflation Target now that's not going to be mentioned by power the FED they can't discuss that during the disinflationary period but the question is you know is he going to drive it down to all the way down to two in the meantime yeah well let me just ask you really quickly because we're almost out of time we've spent a lot of time talking to you about the FED how do you just feel about the markets overall the is this a market that you would tell people to invest into do the levels seem expensive does it seem like a fair price absolutely I mean you're 19 times next 12 months earnings uh and and and and and to me that's a that's a really good good deal that's that's over five percent after inflation as a long-term return after inflation and you know if you buy tips bonds you get less than two percent after inflation and and that margin if you're a long-term investor is going to be a very healthy margin to build well over the long run
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