Bloomberg Talks: Federal Reserve Governor Stephen Miran Talks Interest Rates

Date: September 22, 2025
Host: Bloomberg (Soleil Mohsen)
Guest: Federal Reserve Governor Stephen Miran
Location: Economic Club of New York

Episode Overview

This episode features a wide-ranging, candid fireside chat with Stephen Miran, the newest Governor of the Federal Reserve. Miran discusses his views on current monetary policy, the rationale behind his call for significant rate cuts, his outlook for the U.S. economy, the balance of political and central bank independence, and the mechanics and philosophy behind dissent at the Fed. The conversation, conducted by Bloomberg's Soleil Mohsen, gives listeners rare insight into Miran’s decision-making process, transparency ethos, and his perspective on the Fed’s mandates.

Key Discussion Points and Insights

Miran’s Appointment and Background

• On Taking the Job: Miran describes his surprise upon learning he would be appointed Fed governor (00:29).
  • “My initial thought was that I was going to be asked to run the Bureau of Labor Statistics as a second job... But yeah, that’s not how it turned out.” – Miran (00:29-00:58)
• White House Experience: Previously on leave from President Trump’s administration, where he provided economic analysis (01:07).

Interest Rate Policy: Rationale and Perspective

• Forecasting 150bps Cuts: Miran explains why, despite positive economic messaging from the White House, he prescribed aggressive rate reductions—a position he sees as recalibrating to neutral, not panic (01:50).
  • “Policy is roughly 2 points too restrictive, which is considerably restrictive... it’s better to move there more quickly than less quickly. It’s not a panic.” – Miran (01:50-02:58)
• Labor Market Concerns: Reflects on momentum loss and risks in the labor market as a further reason to lower rates (03:09).
  • “If you keep policy this degree of restrictive for too long, you’re not going to allow things to move in the other direction… It’s imperative that we get closer to neutral quickly.” – Miran (03:09-03:48)
• Response to "Panic" Label: He clarifies his call for successive 50bps cuts is deliberate, not panicked (03:49).
  • “If I were panicking, I would tell people I was panicking.” – Miran (03:49)

Business Investment and Policy Uncertainty

• Policy vs. Rates: Acknowledges some sectors are affected by uncertainty, but identifies high rates as the main barrier for housing investment (04:19-04:52).
  • “If you look at other sectors like housing ... rates are the primary impediment to investing in housing and building more housing at the moment.” – Miran (04:19-04:52)

Economic Outlook for 2026

• Growth and Rates: Projects mid-2% GDP growth for 2026, conditionally upon getting rates closer to neutral (05:06-05:26).
  • “Growth is going to be in the ... mid 2 area.” – Miran (05:06)
• Path of Rate Adjustments: Explains that further incremental cuts might be sensible depending on how effects play out (05:35-06:20).

Fed Independence and Political Influence

• On Central Bank Independence and Political Appointments: Critiques “mission creep” at the Fed and explains transparency in his role despite having worked closely with the administration (07:16-10:13).
  • “There’s no question that the Fed had previously gotten over its skis in terms of politics... The context in which I wrote that the proposals in that paper are a package deal, a system of checks and balances.” – Miran (07:16-10:13)
• On Presidential Pressure: Stresses personal independence in decision making despite the President’s views; would respectfully listen but make decisions based on his analysis (11:48-12:27).
  • “I would respectfully listen to his view... consider whether they had any merit, and then I would make up my own mind based on my own analysis.” – Miran (11:56-12:22)
• On Sharing Presidential Conversations: Confirms nothing inappropriate has ever been asked of him; no secret rate path instructions (12:45-12:59).

Inside the Fed: Culture and Decision-Making

• First FOMC Meeting Experience: Describes a respectful, open atmosphere with real diversity of views (13:41).
  • “It was cordial, it was collegial, it was friendly, it was respectful, and I was very appreciative of that.” – Miran (13:41)
• Consensus and Persuasion: Cites Chairman Powell on the importance of persuasion and thoughtful debate within the FOMC (13:41-15:46).
  • “The way the FOMC works is by persuasion... I’m trying to tell people there’s a reason why policy rates are too high.” – Miran (13:41-15:46)

Independence and Dissents

• On Dissenting: Sees value in ongoing dissent if in disagreement, prioritizing intellectual over artificial consensus (18:13-19:06).
  • “If that means that I keep on... being more individual in my views... then that’s the way it’s going to be. I’m not going to vote for something I don’t believe in just for the sake of creating an illusion of consensus where there is none.” – Miran (18:13-19:06)
• October Meeting Outlook: Will persist with dissent unless data materially changes his view (19:06-19:36).

The "Third Mandate" and Fed's Mission

• Mandate Clarification: Reiterates the Congressional language assigning the Fed the goals of stable prices, maximum employment, and moderate long-term interest rates (20:12-22:07).
  • “Congress assigned the Fed stable prices, maximum employment and moderate long term interest rates... just because I’m a thorough person... I wanted to be respectful of their words and not my interpretation.” – Miran (20:12-22:07)
• Balance Sheet Views: Suggests the size should follow from regulatory needs, not be the focus itself (22:31-24:01).
  • “Focusing on the balance sheet size is focusing on the wrong thing... get the regulatory framework that you want correct and then the right size of the balance sheet will kind of fall out of that.” – Miran (22:31-24:01)

Housing and Mortgage Rates

• Fed’s Role: Lowering policy rates would ease mortgage costs and help housing, but exact transmission is complex (25:18-26:19).
• Presidential Focus on Housing: Recognizes otherwise limited tools beyond the short-term rate for mortgage relief.

Inflation Target Philosophy

• On the 2% Target: Supports maintaining focus, but is open to considering change only after a sustained period on target (26:19-29:00).
  • “Any prospective changes to... an inflation target should only ever be entertained after a material period of the Fed achieving its inflation target... to avoid any appearance of moving the goalposts.” – Miran (26:28)
• Challenges in Measuring Inflation: Calls precision “excessive micromanagement,” pointing out technical oddities in inflation measurement (27:00-29:00).

Notable Quotes and Memorable Moments

• “It’s not a panic. I just see that the risks grow the longer you remain significantly above neutral.” – Miran (01:50)
• “If I were panicking, I would tell people I was panicking.” – Miran (03:49)
• “It’s imperative that we get closer to neutral quickly.” – Miran (03:09)
• “There’s no question that the Fed had previously gotten over its skis in terms of politics... I want to be so transparent and as transparent as I possibly can be.” – Miran (07:16-10:13)
• “I make my analysis based on my own understanding of economics and how the economy works.” – Miran (10:58)
• “I will always be polite and collegial, but I don’t view voting with the consensus for the sake of establishing an appearance of a consensus... to be more important than trying to argue for what I consider to be the correct policy.” – Miran (18:13-19:06)
• “The balance sheet size that you ultimately need falls out of the regulatory framework...” – Miran (22:31-24:01)
• “Any change to the inflation target should only ever be entertained after the Fed has successfully achieved its target for a sustained period of time to make sure there’s no appearance whatsoever moving goalposts.” – Miran (28:00)

Important Timestamps

• 00:29 – Miran’s surprise Fed appointment story
• 01:50 – Explaining need for 150bp rate cuts
• 03:09 – Labor market weakening and policy risk
• 05:06 – Growth and rate projections for 2026
• 07:16 – Transparency and Fed independence
• 13:41 – First FOMC meeting impressions
• 18:13 – Power and ethics of dissent
• 20:12 – The “third mandate” and Fed mission
• 22:31 – Views on the balance sheet and regulation
• 25:32 – Fed’s impact on mortgage rates
• 26:28 – Perspective on the 2% inflation target

Summary Takeaways

Stephen Miran advocates for a data-driven, transparent approach to monetary policy—favoring rapid but reasoned rate cuts to bring policy toward neutrality and support growth without panic. He stresses intellectual independence, transparency in analysis, and a willingness to dissent against consensus when warranted. Miran also addresses the nuances of the Fed’s mandate, the role of population growth and regulatory changes, and practical challenges in inflation measurement. While his term is brief, Miran’s determined and thorough approach aims to meaningfully impact the ongoing debate within the Federal Reserve.