Podcast Summary: Fed Governor Stephen Myron Talks Outlook for Inflation, Rates

Podcast: Bloomberg Talks
Date: November 21, 2025
Guest: Fed Governor Stephen Myron
Host(s): Bloomberg Interview Team

Episode Overview

This episode features a wide-ranging conversation with Federal Reserve Governor Stephen Myron. The discussion centers on the outlook for U.S. inflation, interest rate policy, the labor market, methodology concerns with inflation measures, the timing of upcoming data releases, and policy communication challenges facing the Fed. Governor Myron stands out for advocating a dovish stance on monetary policy, challenging hawkish arguments within the FOMC, and dissecting the implications of data lags and statistical artifacts in official inflation measurements.

Key Discussion Points & Insights

1. Current Labor Market Assessment

• Governor Myron views the latest labor data as dovish, indicating that restrictive Fed policy is beginning to weigh on employment.
  • Quote: “The labor market has been affected by restrictive Fed policy. And given the outlook for inflation, there’s not really much of a need to be as restrictive as we are.” (00:52)
• Points to an uptick in the unemployment rate and more permanent layoffs as evidence policy is “too restrictive.”

2. Debate Over Inflation Persistency

• Responds to Fed Governor Barr's concern that inflation is still closer to 3% than 2%:
  • Myron argues that the prevailing “excess” inflation is a product of statistical quirks, not ongoing supply-demand imbalances.
  • Example: Housing market rents have been near 1% for years, but measured shelter inflation is higher due to lagging methodology in official indexes.
  • Quote: “All of the inflation excess, almost all of the inflation excess, is a mirage. It’s not indicative of supply demand imbalances.” (01:28)
  • He warns against setting policy for key years ahead using indices distorted by past imbalances.
• Criticizes the policy risk of asking people to lose jobs due to these statistical artifacts.
  • Quote: “It’s a mistake to ask people to lose their jobs because of the statistical measurement process.” (01:58)

3. Forecast-Based vs. Data-Dependent Policy

• Myron stresses that monetary policy acts with significant lags and should aim to forecast the economy’s position far ahead (12–18 months), not react to recent data.
• Expresses concern with excessive “data dependence,” which risks backward-looking, suboptimal policy.
  • Quote: “We should be forecast dependent, not data dependent. Being excessively data dependent is to be too backward looking.” (04:43)
• On whether to move meeting dates to await more data: skeptical, citing potential disruption and reiterating forward-looking policymaking.

4. Upcoming Rate Decision and Dissent

• Confirms he would support a 25bps rate cut if his dissent for a larger cut would block any rate reduction:
  • Quote: “I would absolutely vote for a 25 basis point cut if my vote were the marginal vote… to do otherwise would be to cause real harm to the economy for purposes of vanity.” (05:06)

5. Growth Outlook and Stimulus Measures

• Stresses policy is “too restrictive” and may cause unnecessary recession risk.
• While policy should react to real changes in demand and supply, he is not at this stage forecasting stronger growth off anticipated, but unconfirmed, stimuli (e.g., tax refunds).
• Notes the supply-side supports (like regulatory relaxation) need not be hawkish triggers, since they can expand productive capacity without driving excess demand.

6. Inflation Bumps from Stimulus versus Measurement Artifacts

• Refuses to pre-judge the potential inflationary impact of possible future stimulus checks, as no concrete program is yet proposed.
• Key labor and inflation data continue to show policy is, if anything, too tight.

7. Data Lags and Government Shutdown Effects

• Notes the next crucial inflation (CPI) report will not be released until after the upcoming FOMC meeting, due to government shutdown–induced delays. (07:52–08:30)
• Explains that data collection and processing are logjammed by work stoppages and subsequent catch-up, creating a “bullwhip” effect analogous to supply chains.
• Quote: “When you have a government shutdown, all the government employees aren’t working and they come back to work and they’ve got a ton of work to do all at once… we have those bullwhips in government data right now.” (08:30)

8. Financial Stability and Asset Prices

• Pushes back on arguments that lower rates would unduly encourage risk-taking or asset bubbles:
  • Cites the complexity of mapping monetary stance to asset prices and warns against using unemployment as a lever to target market valuations.
  • Quote: “It’s a mistake… to ask people to experience job losses because you think the stock market is too high. I don’t know what the right level for the stock market is.” (09:25)

9. The K-Shaped Economy and Inequality

• Acknowledges the challenges of a “K-shaped” economy but reiterates the Fed’s dual mandate:
  • Quote: “Congress didn’t task us with addressing all social problems… They tasked us with tackling aggregate maximum employment and stable prices.” (11:32)
• Notes that high unemployment would disproportionately harm lower-income Americans more than any hypothetical impact from monetary easing.

10. Personal/Political Remarks

• Shares a light exchange on “politically correct” Fed appointments and downplays inside knowledge, maintaining a candid, direct persona. (12:22–12:45)

Notable Quotes (with Timestamps)

• On excess inflation:
  “All of the inflation excess, almost all of the inflation excess, is a mirage. It’s not indicative of supply demand imbalances.”
  — Stephen Myron (01:28)

• On making people lose jobs over measurement quirks:
  “It is a mistake to ask people to lose their jobs because of the statistical measurement process.”
  — Stephen Myron (01:58)

• On policy lags:
  “Monetary policy works with lags. So you have to set policy based on the forecast… We should be forecast dependent, not data dependent.”
  — Stephen Myron (02:53–04:43)

• On willingness to compromise on rates:
  “I would absolutely vote for a 25 basis point cut if my vote were the marginal vote. There’s no question about that… to do otherwise would be to cause real harm to the economy for purposes of vanity.”
  — Stephen Myron (05:06)

• On asset prices and policy:
  “It’s a mistake… to ask people to experience job losses because you think the stock market is too high. I don’t know what the right level for the stock market is.”
  — Stephen Myron (09:25)

• On the Fed’s mandate and inequality:
  “Congress didn’t task us with addressing all social problems… They tasked us with tackling aggregate maximum employment and stable prices.”
  — Stephen Myron (11:32)

Timestamps for Important Segments

• 00:46 – 01:14: Labor market’s response to Fed policy
• 01:14 – 02:34: Disagreement over inflation persistence and measurement artifacts
• 02:34 – 04:10: Policy lags, outlook, and the significance of upcoming data releases
• 04:57 – 05:24: Rate cut dissent question and policy compromise
• 05:43 – 07:14: Debating supply-side growth and potential stimulus impacts
• 07:52 – 09:05: Data release delays, explanations, and implications for policy decisions
• 09:05 – 10:58: Financial stability, risk-taking, and asset prices in monetary policy
• 10:58 – 12:07: Addressing the K-shaped economy and dual mandate priorities
• 12:22 – 12:45: Politically correct appointments—Myron’s personal/political remarks

Memorable Moments

• Blunt critique of data-driven (backward-looking) policy:
  Myron repeatedly calls for a forecast-based approach: “Being excessively data dependent is to be too backward looking. And if you’re too backward looking, you necessarily are going to have the wrong policies.” (04:43)
• Candor on intra-committee disagreement:
  Openly willing to compromise on rate cuts and calling out “vanity” as a reason not to.
• Anecdote about government shutdown effects:
  Comparing the surge in delayed government data to a “bullwhip effect” in supply chains. (08:30)

Overall Tone and Takeaways

Governor Myron maintains a straightforward, technocratic, and data-literate tone. He is strongly dovish, ready to critique methodology issues in inflation measurement, doubts the urgency for continued restrictive rates, and calls for the Fed to look ahead, not backward. The conversational tone is brisk, sometimes wry, and aims to clarify the rationale behind his dissent within the FOMC.

For those seeking concise expert insight into high-level Federal Reserve policy discussions, this episode provides a window into both the internal debates and the logic guiding current U.S. monetary policy.