Current rate levels are approximately neutral or slightly tight for the economy, evidenced by real growth rates north of 3% in recent years despite the Fed having stopped hiking; this suggests the market was overestimating the need for rate cuts.
causalpending
Speaker
Jeffrey ShermanEvidence Quote
“This is probably the neutralish rate today. Maybe the Fed cuts, maybe they are a little tight, but, you know, the fact that we've been growing, you know, having a real growth rate north of three for the last few years tells me that the Fed wasn't that tight, right?”
Created: 8/12/2026, 10:36:49 PM
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