Jai Kedia

Research Fellow @CatoCMFA with a focus on monetary policy and macro-finance | PhD in Econ from @UCIrvine. Views expressed are my own, not Cato’s.

[Jai Kedia @JaiKedia]

Chairman Warsh's confusing presser this week was less about forward guidance and more about the FOMC having no objective framework.

Read my new @barronsonline op-ed here:
https://t.co/HQmwkKp7tj

[Norbert J. Michel @norbertjmichel]

Treasury’s attempt to engineer lower bond yields through massive buybacks is failing because markets aren't buying the spin. Yields aren't a problem to manage, they’re a signal reporting Washington’s reckless spending and inflation risks. 🧵

[Cato Institute @CatoInstitute]

The Treasury tried to lower bond yields by buying more bonds. It didn’t work. Markets pushed back, and yields rose right after the buyback expansion, says Cato's @JaiKedia. The real fix is to end the spending, tariffs, and war that are driving borrowing costs up in the first place.

https://t.co/mMv2X959rs

[Norbert J. Michel @norbertjmichel]

Looks like markets are overruling Treasury's attempt to overrule markets. Shocker.

[Jai Kedia @JaiKedia]

Another week, another failed attempt by Treasury to lower bond yields. Except now with worse results and even more hubris. Markets are the "house"--not the government.

Read my latest @CatoCMFA article here:
https://t.co/HCvr47L9H2

[Ilya Somin @IlyaSomin]

Today, @Cato and I filed our amicus brief in Federal Circuit, supporting @LJCenter and Oregon (leading coalition of 24 states) cases against Trump's harmful and illegal Section 122 tariffs: https://t.co/71P0dWT72N

[Cato CMFA @CatoCMFA]

"It is foolhardy to think that government financial engineering, such as these bond buybacks, can counter global economic waves and poor macroeconomic policies." - @JaiKedia https://t.co/NoXqaMcgdU

[Norbert J. Michel @norbertjmichel]

Here’s what still amazes me about the latest populist movement: Prior to COVID and the heavy-handed government response, US living standards had been improving for decades, for most income groups. Nobody needs a remedy for that.

And that’s frustrating, but it’s almost nothing compared to listening to JD Vance and company selling a remedy that’s actually a recipe for impoverishing people.

Isolating America will not make it stronger. Keeping immigrants out of the country will not grow Americans’ income. It won’t make Americans more productive.

More government intervention in the private sector will not make America great, it will turn it to Europe. That means Americans will inherit European living standards. That’s not a good deal on its own terms, much less compared to what America had already.

How many times do we have to relearn these lessons? Trade wars, hostility towards immigrants, heavy regulation of markets, socialism (any version), and real wars, all make most people worse off. These ideas should not be winning political messages, even for the cleverest propaganda artists.

[Norbert J. Michel @norbertjmichel]

The truth is that we’re seeing market reactions to a series of trade wars, global conflict and a persistent refusal to address the U.S. fiscal mess. That’s not a "growth" signal, it’s the bill for current policy coming due.

#Economics #Markets #InterestRates #FiscalPolicy

[Chase Oliver @ChaseForLiberty]

Libertarianism doesn't require you to love everyone.

It does however says its morally reprehensible to support government violence against peaceful people who may offend you.

Murderous moralists are far more degenerate than those that cause them to feel offended to begin with.

[Jai Kedia @JaiKedia]

None of the govt programs intended to foster single parenthood or dependency. They all set out for noble-sounding goals.

That’s the libertarian point—govt is BAD at providing moral goods and often does the opposite despite good intentions.

[Andrew T. Walker @AndrewTWalker]

Another lesson is how much libertarianism managed to disguise itself as conservatism. A smaller state and lower taxes are always desirable, but the claim that government cannot be used to advance substantive moral goods is a long-peddled libertarian fiction. If public policy can incentivize single parenthood and lifelong government dependency, as much of the current system does, then there is no principled reason existing funds cannot be reallocated to strengthen marriage, encourage family formation, and promote healthier social arrangements.

But hey, maybe we should just listen to the libertarians and encourage more gambling and porn use instead. Because muh freedum matters most!

[Norbert J. Michel @norbertjmichel]

@JaiKedia is right - this outcome is even worse because even after severely stacking the deck in favor of domestic manufacturing jobs....still nothing.

It's almost as if they're wrong about trade killing domestic manufacturing.....

[Jai Kedia @JaiKedia]

Had manufacturing jobs increased, it wouldn’t mean tariffs were good since those jobs were a govt created misallocation of resources towards a less productive sector.

The fact that manufacturing got worse is a double whammy against tariffs.

[Phil Magness @PhilWMagness]

Fixed it for ya. Also, those are negative signs in the vertical axis.

[Jai Kedia @JaiKedia]

In this @WSJ letter, I expand on @DonLuskin's op-ed arguing against the Fed's forward guidance by providing some recent examples of how this policy led to serious errors.

https://t.co/LBRbJmAEFl

[Cato CMFA @CatoCMFA]

Relying on government financial engineering like bond buybacks to counter global economic waves and poor macroeconomic policy is foolhardy.

$4 billion per buyback against a $31 trillion Treasury market is like bringing pebbles to dam a river.

@JaiKedia https://t.co/NoXqaMcgdU

[Jai Kedia @JaiKedia]

The unemployment rate weighed against capacity hasn't moved much so this isn't necessarily a "good" jobs report. But if it were, it would actually make a rate HIKE more likely given inflation!

[Nick Timiraos @NickTimiraos]

Trump expresses his ongoing irritation with how economic indicator reports that provide any evidence of overheating lead stocks to pull back.

He renews his demand for lower interest rates: "The Fed Board, with its great new leader, must get smart - BE PATRIOTS for a change."

[Norbert J. Michel @norbertjmichel]

Every year when the Fed meets in Jackson Hole we watch the same cycle play out: rampant speculation over whether the Fed will hike rates, with investors being forced to guess central bank intentions from a single speech. This is exactly why we need rules-based monetary policy.

[Norbert J. Michel @norbertjmichel]

In my latest oped for @thehill, I push back against the growing narrative on both the left & right that "40 years of free-market policy has failed."

The data shows living standards actually rose. Where problems do exist, heavy government intervention & spending gets most of the blame, not free trade or free markets.

[The Alex Nowrasteh @AlexNowrasteh]

It’s not often I RT Laura, but I must for @adamnmichel. He wrote a wonderful and illuminating blog post about the insane DSA spending promises.

https://t.co/KXA0q149CT

[Nick Anthony @EconWithNick]

"In reality, these programs are always doomed to fail as they misunderstand or misattribute the forces raising rates in the first place." - @CatoCMFA's @JaiKedia https://t.co/eJwnUTpW2R

[Norbert J. Michel @norbertjmichel]

Warsh hit the nail on the head: central bank forecasts have been abysmal, and adding more "dots" won't fix it. You can’t fine-tune an economy in normal times, much less in the middle of a massive tech shock and persistent inflation.

More simple rules, less discretionary guesswork. That’s what’s needed. @JaiKedia @CatoCMFA @CatoInstitute