저자: JeremySiegel · 외국인
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트럼프 관세 전쟁 속 연준은 금리를 공격적으로 인하할 경제적 근거가 충분하다는 주장. 연준 선호 지표인 5년 5년 선도 기대인플레이션이 PCE 기준 약 2%로 하락 중이고 단기 관세 물가 상승은 일회성. M2 증가율이 4% 미만으로 둔화되어 5~6% 필요치에 못 미치며, 장단기 금리차도 거의 평탄해 4.33%가 아닌 3.33% 수준이 적정. 5월과 6월 인하를 제안하며, 연준 독립성 위협 우려와 함께 금리 인하가 필요하다고 봄.
다듬은 글
Let's talk about all of this right now with Jeremy Seagull. He is . He's also chief economist at Wisdom Tree. Uh Jeremy, what do you think um just in terms of where we are headed this morning? How the world is reacting to the the trade war that's kicked off primarily between the United States and China at this point?
Yes, good morning, Becky. Listen, I've looked at the data and uh I do believe there are persuasive economic reasons for the Fed to aggressively lower interest rates right now. I know that Steve just a little while ago saying, you know, show me some in some evidence uh data that shows this. Well, one of the Fed's favorite indicators for long-term inflationary expectations, it's called the 5-year 5-year forward rate of inflation.
I know that sounds technical, but uh it really isn't a complicated uh issue. By looking at long-term inflation contracts, 10-year and fiveyear, you can extract out the near-term and look at those long-term. And these are marketbased contracts. Um, we know we're going to get a increase in inflation in the short term from the Trump tariffs.
I call that the Trump bump. We're going to get that. But what we need to wonder about is that getting into long-term in inflationary expectations. That's exactly the topic that J. Pal was worried about last week. Is that getting into it? The answer is definitively no. Actually, I've been looking at those long-term inflationary expectations and they've actually been going down.
Um, I mean, you yourself a week ago, a week ago on Wisdom Tree, you wrote, "While the Fed has covered to ease, the mixed signals from the bond market complicate the picture." You said that with the yield curve no longer inverted, the case for Fed rate cuts weakens. Well, it you're right, and now it's just about flat.
But this is before I looked at uh the the case for these inflationary expectations. And right now the uh after the next five years, the long-term inflationary expectations is is 2.3%. And that's based on the consumer price index. And the Fed's favorite uh indicator is the personal consumption deflator index, the PCE index.
And that's about three ten of a percent below that. So really on the PCE, the long-term inflationary expectation that the Fed itself uses that Chair Powell has talked about, they've used this for over 20 years, is now at 2%. Um, so you know, on that standpoint, I I I think uh there's a lot of And by the way, forget about the bond market.
It's a week later. We we're feeling good about things and we should go ahead. the bond market is I mean you know I think the bond market is being disturbed by a lot of things going on uh you know and things about the independence of the Fed and all sorts of other situations. Um and in fact you know it I think the dollar would improve actually if uh if if if JOW actually lowered that rate.
You know another factor is that money and credit are just not growing fast enough. Over the last year, the M M2 money supply has grown less than 4%. For a healthy economy, you need between five and 6% money growth. It's actually lower than it was 3 years ago. And the only way for the Fed to actually stimulate loan growth, to stimulate money growth back to a healthy level, is by lowering those interest rates.
So, you're you're concerned about the Fed's independence because I I got two points from you. One was that there are good economics for Pal economic reasons for Pal to lower rates. The second is that the threats to Fed independence are real and growing. So you're worried about the Fed independence, but you think he should cut rates.
Yeah. And let me say that listen, let's face the facts. If he doesn't cut rates and we have a recession because of the tariffs, who is Trump going to blame? Trump is gonna blame Powell. And the Republican Congress is not all that friendly toward the Fed to begin with. Uh don't forget the whole So you basically think he should cut rates to make sure he keeps the Fed independence.
So listen to you, not Trump or but do this to make sure independence independence is enhanced the probability by him cutting rates right now. You think inflation, Jeremy, you think inflation is you believe those those recent prints on the recent prints on long-term inflation are expectations are are down 30 basis points since Fed took office in in in January.
So the real risk that is exactly yeah the real risk is the economy not not I I agree with you absolutely the real risk right now is the economy and those inflationary expectations into the long term that that that POW said he's concerned about on the actual data is not present at the pres at tariffs tariffs can co I think it's more likely unfortunately for some I think it's more likely tariffs can cause a growth slowdown uh and and the inflation is sort of a oneshot deal because you don't get unless it's a trade war with a you know you keep tit for tat and it keep because it's a oneshot deal.
It's not uh the second derivative where inflation keeps the the pace of increases keeps rising instead of just the first one. So absolutely. Yes. And does that say Joe, you you believe in the poly market and the the markets right now they're saying nearly 60% chance of inflation. All Wall Street firms have raised their rate.
So you have red flags there. You have inadequate money and loan supply growth. You have long-term inflationary expectations at the level the Fed wants. Um you know why not? Um and and by the way, if the economy if if things go well, we don't have a slowdown, don't recess, then the Fed goes back up. You know, this idea that the Fed is like a battleship that, you know, moves slowly.
It goes in cycles of years and all that. It's just not supported by evidence, not supported by theory. Um they could they could move back if need be, but right now the data is flashing red for me to say lower those interest rates. U is there any call for the Fed to kind of wait and see this out? I mean, you've changed your mind over the course of a week.
Maybe they should wait and see what they think over the next month or so. Yeah. Well, I mean, when I'm taking a look at the data that I've seen over the last week and, you know, rethought that. I mean, with listen, we were back in inverted territory. We went above because I think all the the problems of of the dollar.
So, I think that that term structure signal is not as strong. By the way, right now I think it's virtually flat. Um, and normally you're supposed to have approximately a 100 basis points higher on the long rate than the short rate. So, right now that's that argues for a Fed funds rate. That's not 4.33% but 3.33%.
And I think honestly the Fed should start in May and continue in June. Um, and uh, yeah, I mean, you're going to the European Central Bank has lowered seven times. Um, and the long-term inflationary expectations are going down. And money, listen, you're not going to have a sustained inflation with money supply growing at an in inadequate amount.
That's never happened in history. I mean, we had 34 years between 1986 and the pandemic when the money supply was growing 5 a.5% a year. uh and then it exploded under you know pal he you know he ca talk about independence he caved in to Trump and Biden's excessive fiscal spending so you know and that was a case that caused all that inflation back there right now the Fed's favorite indicator of long-term inflation expectations is signaling that he is able to cut interest rates
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