Kevin Warsh Is the New Fed Chair and Rates May Not Drop This Year. Here's What That Means for Your Portfolio.

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• The current federal funds rate of 3.50%-3.75% is low relative to many decades of history but high relative to the past 20 years

  60% confidence

• Warsh faces the task of appeasing President Trump, dealing with a divided FOMC, and navigating a difficult economy in pursuit of the Fed's dual mandate

  60% confidence

• The conflict in Iran could keep gas prices high for at least the next several months

  60% confidence

• Following April economic data, it seems unlikely the Fed will be able to cut interest rates this year or possibly next year

  60% confidence

• Lower interest rates have historically been more supportive of higher stock prices due to economic stimulus, higher DCF valuations, and reduced appeal of bonds

  60% confidence

• The market does not expect the Fed to cut rates this year (2026) or in 2027

  60% confidence

• When bond yields are lower, future cash flows in DCF models are higher, leading to higher stock valuations; when yields are higher, future cash flows are lower

  60% confidence

• There is a higher probability that the Fed will raise interest rates rather than cut them toward the end of 2027

  60% confidence

Cited in these Via News reports

• Global Bond Selloff Accelerates as Fed Leadership Vacuum Drives Treasury Yields to Multi-Year Highs →
• Global Bond Selloff Pushes US 30-Year Yield Past 5%, Forcing Corporate Debt Repricing Worldwide →
• Global Rate Surge Outlasts Powell: Banks on Three Continents Face Higher-for-Longer Reality →
• Warsh Confirmed as Fed Chair; Markets Price 50% Hike as Global Debt Selloff Spreads →