Kevin Warsh’s Market-Driven Approach Weakens Fed Monetary Policy

Federal Reserve Chair Kevin Warsh seemingly wants to outsource monetary policy to financial markets. In his telling, the central bank’s job is to be the referee, not the one influencing market expectations. Warsh says he wants markets to play the ball, not the Fed. To ensure that outcome, he argues that not only is it essential that the Fed provide no forward guidance about the future path of interest rates, but also that the Fed not explain how it would likely respond as circumstances change, t