Neel Kashkari looked at inflation data that came in softer than expected and decided the correct response was to say inflation is still too high. This is like getting a B+ and telling your parents you failed.
The PCE data dropped Wednesday. Kashkari sat down with Steve Liesman that night to explain why good news is actually bad news if you squint hard enough. He called the labor market "pretty good" which is Fed-speak for "I have no f*cking idea what happens next but I'm not saying that on CNBC."
Retail traders spent the evening trying to decode what "still too high" means for their SPY calls expiring Friday. They pulled up charts. They drew lines. They measured the angle of Kashkari's eyebrows during the interview. None of this will help them.
The Federal Reserve has one job: move rates up or down based on data. Kashkari looked at data pointing down and said maybe we keep things where they are because of vibes. This is the same institution that missed inflation for eighteen months while calling it transitory, so at least they're consistent in their uselessness.
Somewhere in Minnesota, where Kashkari runs his regional Fed bank, a day trader named Marcus is convinced this interview contains a hidden signal about the next rate decision. Marcus has already updated his TradingView layout. He's added three new indicators. He's watching the replay frame by frame.
Marcus will lose money on Friday regardless of what the Fed does because Marcus thinks interviews matter more than price action. The chart doesn't care what Kashkari said to Liesman. The chart doesn't watch CNBC. The chart just moves, and Marcus just loses.
Photo by Markus Winkler on Unsplash
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