Wendy Edelberg

Good to be here.

Talking about the same issue again.

Oh, I agree with you.

It's a very big deal.

And I am mystified why the bond market didn't react.

And frankly, Trump is probably frustrated that the bond market didn't react if he's paying attention.

Short term treasury rates didn't budge today.

Markets don't think what Trump did ensures more rate cuts this year.

And that surprises me.

Well, so for example, futures markets imply an expectation of only 40 basis points of cuts in the Fed funds rate under the next chair's term.

So Trump's hand-chosen guy oversees not even two full cuts.

The chance for a full percentage points of cuts –

Less than 10 percent.

So whatever Trump is selling with these attacks on the Fed, the market isn't buying it yet.

But when they do, I worry it will not be pretty.

Well, I have two guesses why the markets haven't woken up to what's going on.

So one, maybe markets assume that Trump's pick will get religion once in the position and prioritize Fed independence.

I mean, maybe in a world where an independent Fed just happens to do precisely what Trump wants.

I think the idea of the next chair prioritizing independence is just wrong.

I think Trump learned his lesson with Powell and he's not going to end up with another chair who defies him.