![\"Eccles](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2025\/09\/1758464768_20_960x0.jpg\")
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Facade of the Marriner S Eccles building of the United States Federal Reserve, on a bright and sunny day in Washington, DC, United States, July 24, 2017. (Photo by Smith Collection\/Gado\/Getty Images)<\/p>\n
Getty Images<\/p>\n
Markets are information. They\u2019re constantly pricing the known and unknown, with \u201cmarkets\u201d a perfectly apt descriptor since no one agrees about the knowns and unknowns. <\/p>\n
Consider this with Hoover Institution visiting fellow Mickey Levy\u2019s recent assertion that \u201cThe Fed should ignore what markets (and the president) want and carefully consider the risks of lowering rates.\u201d Most of us can\u2019t figure out the desires of the next door neighbor, but Levy knows what markets want? Hopefully readers see in the question the folly of Levy\u2019s suggestion of a monolithic quality to the markets. They\u2019re the embodiment of disagreement. <\/p>\n
From there, and assuming for a second that what\u2019s not true is in fact true, that the Fed can create cheaper or more expensive credit by decree, it\u2019s not unreasonable to point out that what Levy imagines to be true isn\u2019t. \u201cMarkets\u201d want the Fed to cut, but Levy implies markets and the president are stupid. Hmmm. Both?<\/p>\n
It raises a question: would apartment owners, butchers, and Ferrari dealers like to attain fair market value for what they bring to market, or not? The question raises more questions about what Levy could possibly mean. He\u2019s associated with Hoover, an institution that leans in favor of market forces free of government meddling. Which means Levy and his colleagues would likely nod along to the comment that if New York City\u2019s housing authority sets the monthly rental price for apartments at $1,000, the market impact will be a scarcity of apartments. <\/p>\n
One guesses Levy et al would agree that what\u2019s true about apartment scarcity would similarly reveal itself if steaks, veal and Ferraris were decreed artificially cheap. Markets always speak, and they frequently speak noisily when governments substitute their limited knowledge for that of the marketplace. <\/p>\n
It\u2019s something worth keeping in mind with Levy\u2019s blithe comment about what \u201cmarkets\u201d want from the Fed. Lest he forget, no one borrows money, rather they borrow what money can be exchanged for: think goods, services, inputs that create goods and services, labor, etc. Which is a reminder that as opposed to being provided by some central authority, credit is produced\u2026in the marketplace. <\/p>\n
To read Levy is to imagine he disagrees with the above. That credit is just there, only for central banks to decide how much or how little should be flowing in the economy, and at what price. No, he couldn\u2019t possibly believe that. Maybe he thinks the Fed knows how much or how little credit is inflationary? That\u2019s what he seems to believe, but then why would he want to empower a creation of governments that have overseen so much inflation to protect us from government creations? Wouldn\u2019t those who produce credit, or have access to it, be better at deciding when and when not to offer it? <\/p>\n
One guesses Levy would also nod along about the power of compounding, but if so the latter would contradicts his comments about what the \u201cmarkets\u201d want. Since compounding is so elemental to the health of savers, and if savers are a big part of the market, do they want what Levy imagines the Fed can provide: lower cost credit? Hopefully this question similarly answers itself, or maybe not?<\/p>\n
Maybe Levy means the stock market wants lower rates from the Fed, but then stocks soared amid 525 basis points of Fed rate increases that began in 2022, but plummeted in January of 2001 and September of 2007 and beyond amid intense Fed cutting. <\/p>\n
So, once again, what do \u201cmarkets\u201d want? If we knew we\u2019d all be trillionaires because markets are us. Which seems to conclude for us that while markets are knowledge personified, those writing about them really and truly aren\u2019t. <\/p>\n","protected":false},"excerpt":{"rendered":"Facade of the Marriner S Eccles building of the United States Federal Reserve, on a bright and sunny…\n","protected":false},"author":2,"featured_media":151304,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[84,4168,814,16402,467,69495,4767,56,54,55],"class_list":{"0":"post-151303","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-business","9":"tag-federal-reserve","10":"tag-interest-rates","11":"tag-john-tamny","12":"tag-markets","13":"tag-mickey-levy","14":"tag-stock-market","15":"tag-uk","16":"tag-united-kingdom","17":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/151303","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=151303"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/151303\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/151304"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=151303"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=151303"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=151303"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}