Stephen Miran

The FOMC meets to vote once every six weeks or so.

Now, I think that's a bit longer than most shutdowns have historically lasted, so I'm hopeful that we'll get the data by the time we actually have to make the decision.

So my view is that policy should be forward-looking, right?

I don't necessarily have a forecast that those items are going to continue rising.

In fact, I think that a lot of them will actually reverse somewhat.

But for my process, what matters most of all is the cost of housing, because that is the single largest component of the inflation process.

And it's also one of the things that people notice the most.

They notice when their rent surges.

They notice when the cost of shelter increases.

And that's why it gets the largest weight in the inflation indices.

And my expectation is that we've just experienced the biggest population shocks to both the upside and the downside in my lifetime and I think in most people's lifetimes.

And to me, it would be very surprising if that left no lingering trace on the price of shelter.

And so I am expecting a significant disinflation to the services component of the inflation disease driven by shelter, which is affected to an extent by changes in population growth.

Yeah, so first of all, I have seen some folks argue that they think that my conception of the neutral rate is zero.

That's not the case.

I think that's a misreading of the speech.

If you read the speech carefully, you'll notice that I do a weighted average of a model-implied ex-ante and a market-implied ex-ante rate, and it gets to about a half.

And that's consistent with the dot that I put down on the statement on the summary of economic projections.

And so I basically thought, you know, sort of going into things last year, there were all these policies that were pushing our star higher, like the highest population growth we'd seen in decades, the largest fiscal, you know, sustainable fiscal deficits we'd seen, sustained fiscal deficits we'd seen in a really long time.

Those are pushing our star higher.