Is Warsh Setting Up A Policy Error?

RIA · Sep 9, 2026

Fed Chairman Kevin Warsh's recent Hawkish Pivot raises a troubling question: is he actually worried about inflation, or is he changing his tune to build the Fed's inflation-fighting credibility as it tries to stabilize long-term yields? If the latter, he risks making a policy error if he raises rates. At his recent Jackson Hole speech, Warsh provided some specific inflation data. For instance, he disaggregated the PCE's 199 components and found 54% rose above 3% over the past year, citing it as evidence of broad-based inflation. We think it's an unusual choice of inflation data, given his…