WARSH WOBBLE

New central bankers tend to make mistakes; Warsh made his first on Wednesday. His decision not to raise rates, after steadily talking tough about inflation and price stability, pushed long-term Treasury yields to multidecade highs. This is because bond markets are losing confidence in his willingness to hike rates and that’s raising long-term inflation fears. Combine that with Warsh’s deliberate anti-communications strategy and markets are somewhat perturbed.