Diane Swonk

And certainly with the way that the C-suite and the gap between employees and the C-suite see AI and how it's affecting productivity growth is another issue.

We could literally see a payroll recession as the economy booms.

in 2026.

And that is something that I never expected to see out there.

I think it's really important to remember, though, that we still have not ameliorated inflation.

We still have inflation.

And it's much like compounding stock returns that has driven that wedge of wealth higher, compounding inflation over the last five years.

has left prices out of reach for too many.

At the same time, the labor market is frozen, and that is why you're seeing the consumer attitude surveys we are.

It's really important from a macro perspective because I think it's providing a underlying floor under inflation.

And that's what I worry about could happen with fiscal stimulus on top of it to temporarily disperse economic gains at the beginning of the year as we see those tax refunds come in.

That is important because you...

sort of the sugar high could be very short lived if it only makes inflation stick.

And as I said, inflation is already compounded to the place where most Americans feel that things are out of reach.

And that underscores and undercuts the Fed's inflation fighting credibility.

Well, first of all, we're not past it.

And he didn't say we were past it yet.

But an important issue is that's at the heart of the debate at the Fed.

Tariffs are typically a one-time bump in prices.

And so that is historically what you would count on.