Chris Zaccarelli, the chief investment officer for Northlight Asset Management, said Warsh’s first meeting resembled a corporate turnaround effort.
“Like a skilled CEO brought in from the outside to turn a company around, the new Fed Chair reiterated his confidence in the existing leadership and practices, but organized committees and working groups to ‘study’ how things are currently done, setting the stage for far-reaching changes in the future,” Zaccarelli wrote.
The approach could lead to a less transparent Fed, changes to its inflation framework, and a smaller balance sheet, while laying the groundwork for a mix of rate cuts and balance-sheet tightening, Zaccarelli added.
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