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IBM is now looking to improve productivity with artificial intelligence, including with a new coding tool called Bob. View More

In this articleIBMFollow your favorite stocksCREATE FREE ACCOUNT IBM CEO Arvind Krishna attends a Rose Garden Club event on the Rose Garden of the White House in Washington on July 6, 2026. Mandel Ngan | Afp | Getty Images IBM lowered its 2026 forecast and delivered weaker earnings than analysts had projected on Wednesday, even after the company issued an earnings warning last week. IBM said it aims to widen its full-year pre-tax margin by about 1 percentage point through higher productivity. Here's how the company did relative to LSEG consensus:Earnings per share: $2.93 adjusted vs. $2.97 expected Revenue: $17.16 billion vs. $17.58 billion expectedIBM's revenue grew 1% year over year in the quarter, according to a statement. Net income of $2.17 billion, or $2.30 per share, decreased from $2.19 billion, or $2.36 per share, a year ago. Adjusted earnings exclude acquisition-related adjustments.Management called for 4% to 5% revenue growth in constant currency for 2026. As recently as April, IBM had been looking for over 5% growth at constant currency. The company reiterated expectations for $1 billion in higher free cash flow for the year.Analysts cut their estimates after IBM announced preliminary second-quarter results. In a letter to investors, CEO Arvind Krishna cited worse-than-planned performance in sales of Z mainframe computers and transaction processing software as organizations rushed to buy hardware ahead of expected price increases. The stock dropped 25%, marking its sharpest single-day decline on record.The revenue and adjusted earnings per share figures IBM disclosed on Wednesday were in line with the figures released a week ago. Read more CNBC tech newsGoogle expands Gemini lineup with cheaper models and new Mythos rivalBessent says U.S. could sanction China over AI model 'theft'Nvidia details its next-generation Vera CPU for AI, setting up challenge to AMD and IntelIntel's foundry lands first named customer under CEO Lip-Bu Tan, as Fortinet signs on for security chips As of Wednesday's close, IBM shares were down 30% so far in 2026, while the S&P 500 index was up about 10%.IBM said its high-margin software segment produced $7.76 billion in second-quarter revenue, up 5%. Consulting revenue, at $5.33 billion, was flat. Revenue from infrastructure, at $3.84 billion, declined 7%, with Z mainframe revenue falling 42%.During the quarter, IBM said it signed a letter of intent to build a U.S. quantum chip foundry. It also introduced the Bob artificial intelligence coding tool that relies on a mixture of generative models, with adoption from over 80,000 employees."IBM is accelerating productivity by scaling software development leveraging AI, increasing the effectiveness of its sales and marketing organization, and optimizing its supply chain, the company said in Wednesday's statement. "These efforts help enhance margin and free cash flow, and strengthen the company's ability to capture significant growth opportunities."WATCH: Melius’ Ben Reitzes on what's next for IBM watch nowVIDEO4:5504:55Melius’ Ben Reitzes on what's next for IBMSquawk on the Street Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

He said demand for bullion continues to broaden, led by central banks that have been adding to their reserves alongside growing private-sector interest. View More

In this articleNGFollow your favorite stocksCREATE FREE ACCOUNT watch nowVIDEO2:5602:56John Paulson: Gold in the early stages of a long-term bull marketThe Exchange John Paulson, the hedge fund manager who made billions betting against the U.S. housing market before turning bullish on gold, said he believes the precious metal is only in the early stages of a long-term rally."I do think we're in the beginnings or the early stages of a long-term bull market for gold," Paulson said on CNBC's "The Exchange" Wednesday. "As people lose faith in paper currencies, gold as an alternative will continue to grow."Paulson, whose wager against subprime mortgages became one of the most profitable trades in Wall Street history, shifted his focus to gold in 2009, arguing that the unprecedented fiscal and monetary stimulus following the financial crisis would ultimately weaken the U.S. dollar. Since then, gold prices have roughly quadrupled, topping the $5,000 threshold before pulling back.The billionaire investor said demand for bullion continues to broaden, led by central banks that have been adding to their reserves alongside growing private-sector interest."Gold is becoming the most apt reserve currency in the world, replacing fiat currencies," Paulson said. "The demand from central banks, for instance, has continued to grow, as has the private sector."Paulson also argued that investors stand to benefit more from owning gold miners than bullion itself, particularly companies with large undeveloped reserves."I think the greatest way to invest is to invest in early-stage gold stocks," he said.Paulson made the comments as NovaGold Resources announced it would acquire Paulson Advisers' 40% stake in the Donlin Gold project in Alaska. Paulson, who serves as co-chairman of NovaGold, said the company offers investors leveraged exposure to rising gold prices because of its sizable resource base."NovaGold has 40 million ounces of gold indicated and measured resources and reserves at the market [capitalization] of $4.2 billion," Paulson said. "I think the best way to play gold is through stocks like NovaGold, if not NovaGold itself." Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

A new asymmetry in the market means fuel prices won't fall quickly even if the shooting in the Iran war and Strait of Hormuz stops. View More

A person refuels their semitruck at a Pilot Traveler Center in Lockhart, Texas, March 9, 2026.Brandon Bell | Getty Images The U.S. economy is more vulnerable than ever to the problems in energy markets caused by the Iran war. The economy has been remarkably resilient, but the buffers that protected Americans from earlier price spikes are wearing thin. Bottom line: The war will erode Americans' standard of living this summer even if the actual fighting stays more contained than during the first phase of the conflict. From President Donald Trump's perspective, having kicked off a return to direct conflict with Iran, there is now little he can do to shield Americans from the economic fallout. The White House says the president has been honest with the American people and that prices will fall soon. "As the U.S. military degrades the terrorist Iranian regime's ability to attack commercial vessels and disrupt the free flow of energy through the Strait of Hormuz, oil and gas prices will plummet back to pre-conflict levels," Taylor Rogers, a White House spokeswoman, said in an email.Anyone who has filled up at the pump in recent days has already felt the pain. The national average price at the pump was $4.06 a gallon on Wednesday, up 4.4% from $3.89 a week ago, according to AAA. That's painful. But for the full economic effect, watch diesel, "because of course that is the lifeblood of the U.S. economy," said Christian Lawrence, head of Americas and energy market strategy at Rabobank.  Read more CNBC politics coverageTrump imposing 50% tariffs on certain Canadian goods over alleged trade discriminationTrump says Netanyahu won't be arrested in New York, pushing back on MamdaniSen. Darline Graham running for full term to replace late brother Lindsey Graham The U.S. Energy Information Administration's benchmark for diesel jumped nearly 34 cents last week to $5.13 a gallon, the biggest weekly climb since the first week of the war in March. Those figures are used to determine fuel surcharges that airlines and other companies impose on customers, which can push price hikes out to the rest of the economy.We've been here before, of course. The start of the war in March saw oil prices spike and gas and diesel prices follow, only to fall when the shooting paused a few weeks later. With periodic reports that the U.S. and Iran are trying to hash out a new pause in the fighting, it might seem like a return to lower prices is only a presidential Truth Social post away. Unfortunately, that's where things have changed, particularly in economically vital diesel. "There's a bit of an asymmetric relationship there in the sense that, if oil goes up, then diesel prices are going up," Lawrence said. "If oil goes down, diesel prices might come off a little bit, but they're still going to be much higher."Problems have been accumulating in the refining sector that turns raw crude oil into the distilled products that actually get pumped into cars and trucks. U.S. refineries are at 96.1% of their capacity, the EIA said Wednesday. If refineries could produce more at that level, they would. U.S. refineries kicked into overdrive when the war started to help produce jet fuel and other products for European markets that suddenly found themselves cut off from their suppliers in the Middle East.Inventories that were run down early in the war have yet to be replenished amid summer demand. The EIA reported last week that storage at the crucial delivery point of Cushing, Oklahoma, has since early June been at so-called tank bottom, the level at which remaining liquids can't physically be drawn out. The Strategic Petroleum Reserve is down to 311 million barrels, its lowest level since March 1983, according to EIA data.Iran isn't the only war still raging, either. Ukraine hit 24 out of Russia's 34 largest refineries in the past three months, analysts with BofA Global Research note. Russia has switched from a supplier of diesel and other products to an importer, just as China is trying to restock its own inventories.More oil is getting through the Strait of Hormuz now than during the teeth of the crisis in March, according to the International Energy Agency, even as ship attacks in the waterway continue to be a risk. But that oil doesn't help anyone until it's turned into something useful for the global economy. That makes benchmark prices like Brent crude, at $94 a barrel midday Wednesday, less important as an indicator than the retail prices consumers actually pay. None of this amounts to an immediate economic crisis, but it adds to the affordability pressures that have been weighing on Americans for years. Inflation data delivered a happy surprise last week when the consumer price index came in at a better-than-expected 3.5% for June. But the reprieve is likely temporary. Higher fuel prices will eat into wage gains and force Americans to dip deeper into their savings.The CNBC All-America Economic Survey released last week found 37% of U.S. voters said they are using credit cards more often to pay for things due to higher food and gas prices. That's a 6% increase since April as the war has dragged on.The administration has tried to stanch the bleeding. It directed a massive release of oil from the SPR, eased restrictions on which ships can carry fuel and other commodities, and reduced sanctions on Russian and Iranian oil. All of these measures are arguably already priced into the market, however, and it isn't clear there are more levers the administration can pull in the short term.A lasting end to the conflict would lower oil prices, but gas and diesel may be stuck high at least through Labor Day, when the end of summer has fewer people on the roads. The surge in demand will eventually prompt more refinery construction. "But this takes time. There is no short-term solution," Lawrence said. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

Google's AI summaries have reduced traffic to websites from the search results page and Reddit is reconsidering the benefits of the deal, the Journal said. View More

In this articleRDDTGOOGLFollow your favorite stocksCREATE FREE ACCOUNT Cheng Xin | Getty Images Shares of Reddit slid 8% on Wednesday after the Wall Street Journal reported the company has discussed shutting off Google's access to its content for artificial intelligence use. Reddit stock is down roughly 25% year-to-date. The two companies struck a deal in 2024 to allow the search giant to train its AI models on Reddit's content. But as Google's AI summaries reduced traffic to websites from the search results page, Reddit is reconsidering the benefits of the deal, according to the Journal, citing people familiar with the matter.According to the report, the $60 million-a-year deal is ending soon, and the companies are in talks about potentially renewing the partnership.A Reddit spokesperson told CNBC in a statement that the company is approaching negotiations "just like any business should, by focusing on doing what's best for Reddit.""A lot has changed since those first deals were signed, but our goals are the same: making sure any partnerships drive our business and recognize the unique value of Reddit's data," the statement read. "There is a wide range of ways to do that; those are all things we'll discuss at the negotiating table."CNBC has reached out to Google for comment.The search traffic trend can be seen on other sites as well, with Politico's Google traffic falling 23%, CNN's falling about 25%, and Business Insider's dropping more than 85% between June 2025 and 2026, the Journal reported.It's part of a patchwork of media and publishing companies that have reevaluated their relationships with the biggest AI giants, with some taking legal aim to protect their intellectual property as their sites have suffered lower search traffic.Last year, Chegg sued Google in federal district court, claiming that its AI summaries of search results hurt the company's traffic and revenue. In a statement to CNBC at the time, Google said the company "sends billions of clicks to sites across the web, and AI Overviews send traffic to a greater diversity of sites." Google responded to the Wall Street Journal on Wednesday with a similar statement, saying that its AI features help creators and publishers grow their audiences. Read more CNBC tech newsGoogle expands Gemini lineup with cheaper models and new Mythos rivalBessent says U.S. could sanction China over AI model 'theft'Nvidia details its next-generation Vera CPU for AI, setting up challenge to AMD and IntelIntel's foundry lands first named customer under CEO Lip-Bu Tan, as Fortinet signs on for security chips Reddit has also had a similar partnership with OpenAI that allows for the ChatGPT maker to train its AI models on its content, as part of Reddit's data licensing business that helped fuel an earnings beat last quarter. During the first quarter, the company blew past analysts' expectations after revenue jumped 69% from a year earlier, reporting earnings per share of $1.01 versus 58 cents expected, and revenue of $663 million versus estimates of $611 million. "We have important partnerships with both Google and OpenAI," Reddit CEO Huffman told analysts on the earnings call. "Those are very meaningful to us, and I think it's mutual. We continue to value those."The company is set to report its second-quarter earnings on July 30. Stock Chart IconStock chart icon5-day stock chart of Reddit. watch nowVIDEO2:5302:53Reddit CEO Steve Huffman says his company will win big with AIMad Money with Jim Cramer Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

The Secret Service has seen a 40% increase this year in cases involving threats to protectees, including President Donald Trump. View More

U.S. Secret Service Director Sean Curran testifies during the House Appropriations Homeland Security Subcommittee hearing in the Rayburn building in Washington, April 16, 2026.Tom Williams | CQ-Roll Call, Inc. | Getty Images A senior U.S. Secret Service official said Wednesday that the "threat environment" for the agency's protectees, who include President Donald Trump, "is the highest we've ever seen.""What we're seeing now is something I've never seen before," said the senior official, who spoke to reporters at a background briefing on the condition that they not be identified by name before a public briefing.There have been about 10,000 cases involving threats to government officials, including Supreme Court justices, so far in 2026, the official said, according to a pool report of the briefing by MS NOW. That represents a 40% increase in such cases over the same period last year."They're increasing in volume and complexity," the official said, a week after Supreme Court Justice Amy Coney Barrett told a House subcommittee that the threat level to her and other federal judges "is really high."The Secret Service has seen the number of mental health committals of people suspected of making threats to protectees spike by a factor of 10, according to the official.The briefing came ahead of Friday's rescheduled annual dinner for the White House Correspondents' Association at the Waldorf Astoria in Washington. Trump is set to attend the event. Read more CNBC politics coverageTrump imposing 50% tariffs on certain Canadian goods over alleged trade discriminationTrump says Netanyahu won't be arrested in New York, pushing back on MamdaniSen. Darline Graham running for full term to replace late brother Lindsey Graham The WHCA's originally scheduled dinner was abruptly suspended in April when a man armed with multiple weapons tried to storm past a security checkpoint inside the Washington Hilton Hotel as Trump was attending the dinner.The man, Cole Tomas Allen of California, was tackled by Secret Service officers before he could get into the ballroom where Trump and other top administration officials were. Allen has been charged with trying to assassinate Trump.Matthew Quinn, the Secret Service's deputy director, when asked by a reporter at the public part of the briefing how concerned the agency is about the threat of drones being used to attack protectees, said, "Very.""Look, the threat's real," Quinn said. "Look at Ukraine .... It's just a matter of time before it comes to the United States."But Quinn also said that the White House is "very safe from attack.""The technology that we're deploying, and not just at the White House, at all protected sites, is cutting edge right now," he said."The threat continues to get tougher and tougher, you know," Quinn said. "You're talking fiber-optic controlled drones now, dark drones. So it's a constant chase to keep up with it. But we're doing a tremendous job to stay ahead of the threat, especially at the White House."On Tuesday, Trump was asked by a reporter at the White House if he feels safe, considering what have been several attempts on his life."I feel safe," the president replied. "Why wouldn't I feel safe?"Trump narrowly escaped being killed at a campaign rally on July 13, 2024, in Butler, Pennsylvania, when gunman Thomas Crooks opened fire on Trump. An audience member, Corey Comperatore, was killed in the attack, and two other people were seriously injured.Two months later, a Secret Service officer shot at another gunman who was hiding in shrubs on the perimeter of the Trump International Golf Club in West Palm Beach, Florida. That gunman, Ryan Routh, was convicted in Florida federal court last September of trying to assassinate Trump, and of other charges.Routh is serving a life sentence in prison. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

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The Samsung smart glasses are the tech giant's first foray into the product category which is currently dominated by Meta. View More

In this articleMETAFollow your favorite stocksCREATE FREE ACCOUNT One of Samsung's smart glasses on display at its Galaxy Unpacked event in London on July 22, 2026.Samsung Samsung on Wednesday detailed the features of its upcoming smart glasses, including gesture controls, as it looks to mount its first challenge to Meta in the device category. The South Korean tech giant had previously unveiled the "intelligent eyewear" at Google I/O conference in May, showing off two products designed with its partners Gentle Monster and Warby Parker. At the time, Samsung gave very few details about the design and functionality.At Samsung's Galaxy Unpacked event on Wednesday, the company said the glasses have a built-in camera, as CNBC first reported earlier this year. The camera can capture content that the user is seeing such as taking a video. It can also read content on a whiteboard or presentation and organize the key information into notes.The device can summarize long messages that a person receives on their smartphone. This can be heard from the built-in speakers in the glasses. Samsung's glasses are equipped with Qualcomm's Snapdragon AR1 Gen1 chip and must be tethered to a smartphone. The device also has a portable charging case. James Choi, executive vice president at Samsung and the head of the research and development division behind the glasses, said the company is testing gesture controls with its smartwatches. That would mean a person wearing a Samsung smartwatch could make a specific gesture with their hand, which could carry out a feature on the device. Users could also potentially carry out gestures with Samsung's Galaxy Ring device, which it launched in 2024, Choi said. When the device launches this Fall, there will be "more designs" and colors beyond what Samsung has shown off so far, Choi told CNBC. Meta challenge Samsung, which is one of the biggest consumer electronics players in the world, is entering a market that Meta has dominated since 2021 with its range of smart glasses, such as the Ray-Ban line up. The Facebook parent company had 69.2% share of the smart glasses market in the first quarter of 2026, according to IDC. Meta has recently been expanding its portfolio of devices. Last month, it launched a $299 set of entry-level smart galsses and in 2025 the company unveiled the $799 Meta Ray-Ban Display glasses, which have a built-in display.Choi would not disclose the pricing of Samsung's offering but said it would be positioned as a "premium" product. He added that the device will be sold via its partners' sales channels."We want to make it reasonable, but as I mentioned ... the quality of the product itself, we want to position as premium. It doesn't mean that it's crazy expensive," Choi said, adding that the glasses will not be at the "lower end.""Samsung's arrival represents a serious challenge to Meta, but success is far from guaranteed. Ray-Ban Meta already enjoys strong awareness and growing adoption, while Samsung has historically struggled to convert its vast smartphone base into users of complementary Galaxy devices," Paolo Pescatore, founder of PP Foresight, told CNBC. "Eyewear represents another valuable upsell opportunity, but Samsung must deliver compelling everyday use cases and prove it can persuade consumers to buy into more than just the smartphone." Read moreSamsung ups prices as it launches new foldable smartphones ahead of expected Apple debutApple veteran’s Chinese smart-glasses firm becomes unicorn as Tencent, Meituan fund rival to MetaGoogle gives first glimpse of new AI glasses ahead of fall launch Francisco Jeronimo, an analyst at IDC, said he "wouldn't be surprised" if Samsung priced the device between $600 and $700 to "strengthen their premium brand." But he added that there is a risk if they price the device high "without offering more" than what Meta's Ray-Ban products currently offer. "That is going to be quite a difficult move to sell that kind of device," Jeronimo said. Choi said the company has "just started" in the smart glass category and expects it to be a "niche market" that will not reach 100 million units in sales in the early days of Samsung's entry.However, he declined to provide Samsung's sales expectations. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

In five public appearances, Warsh has used the phrase "family fight" 13 times, returning to "first principles" 11 times and "inflation is a choice" for the Fed six times. View More

watch nowVIDEO4:2904:29Cracking the Kevin Warsh code: Here's what to knowSquawk Box He's not quite at the level of obscurity of former Federal Reserve Chairman Alan Greenspan, but new Fed chief Kevin Warsh has settled on a few phrases that are notable for their repetition and lack of clarity.In five public appearances, starting with his nomination hearing in April, through his first press conference, roundtable in Portugal and two congressional testimonies, Warsh has used the phrase "family fight" 13 times, returning to "first principles" 11 times and "inflation is a choice" for the Fed six times.But what those phrases mean for monetary policy is more challenging than counting their usage. Yet, with a chairman who has decided to say less than his predecessors, there's a premium on understanding the words he does choose. CNBC asked five close Fed watchers their views on what these three phrases mean to them. 'A good family fight' Dan Greenhaus, strategist, Solus Alternative Asset Management: "If Chair Warsh encourages more open debate around policy and creates an environment where prevailing assumptions can be challenged rather than simply accepted, that should ultimately lead to better policymaking. The benefit is less about changing the outcome of any individual meeting and more about improving the quality of the decision-making process over time."Loretta Mester, former Cleveland Fed president: "Ensuring the environment at the [Federal Open Market Committee] meeting allows for all views/arguments to be heard. I note that this was already the atmosphere when I was on the FOMC. I never felt constrained in what I said or the policy case I argued. In reality, it is 19 people around the table so there has to be some order or else maybe it is only the loudest voice in the room that gets heard and you will actually have fewer views expressed since it will be hard to jump in."Claudia Sahm, chief economist at New Century Advisors: "FOMC meetings tend to be highly scripted affairs, with prepared remarks read aloud and limited conversation. Warsh wants a livelier back-and-forth — a style he is more comfortable with. The format is unlikely to affect the policy decision, and 19 participants is a large group for a free-for-all conversation. "Mark Spindel, Fed author and Potomac River Capital chief investment officer: "To Kevin, this is his aphorism for the natural debate going on inside the FOMC and the Board. It implies obvious disagreements, but like all 'family fights' is best kept to members of the family and not revealed too much to the public. I think it's the second part that his committee colleagues (and market participants) are finding problematic, and doesn't fit the priors. Members of the committee are clearly willing to disagree in public, or at least state their opinions much more openly (than Chairman Warsh). It's also a way of deflecting his responsibility from external pressure (POTUS, CONGRESS, MARKETS)."Michael Feroli, chief U.S. economist at JPMorgan: "I guess the family fight is him trying to be folksy, but it doesn't depart from the tradition under [Ben] Bernanke of (publicly) welcoming dissenting opinions." 'First principles'  Spindel: "This is vague enough to mean whatever Warsh wants it to mean, but in context, it appears to be the basis for the decision making and structural reform he is manifesting. Over the summer (in Sintra) he said his Central Banking leadership colleagues shared a 'willingness to go back to first principles' as he questioned the whole process of monetary policy making. I'd think his re-introduction of the monetary aggregates, his cute "monetary policy should have something to do with money," is cut from the same general cloth as 'first principles.' Sadly, the science of monetary policy and other workhorses of monetary policy (The Phillips Curve), economic forecasting even appear to be unhelpful in Warsh's first principled approach. He's not been shy about slamming the year-after-year misses in inflation and blaming [Jerome] Powell and company. The low level of interest rates, the balance sheet, the failure to tighten sooner, FAIT and so on, all of that (to Warsh) was a departure from 'first principles.'"Sahm: "'First principles' is code for 'question everything.' Warsh has said repeatedly that he wants "regime change" at the Fed and questioning the basic assumptions of how monetary policy is done fits that agenda. I am skeptical that Warsh will be able to rewrite first principles. Showing that an assumption is flawed is not enough; it requires offering a better replacement. Even with his task forces, Warsh is likely to come up short on new first principles — no regime change in monetary policy, but some incremental improvements to how it's done."Mester: "Rethink the way the Fed goes about achieving its dual mandate goals of price stability and maximum employment without preconceived notions or assumptions, or precluding approaches because they may differ from the current approach. Think first about what the best approach is for communications, inflation and labor market assessment, balance sheet and operating framework, and data sources. Then consider how to transition to these new approaches.""Note that the Committee has tended not to want to make major changes — consider the number of times the statement changed only by one or two words. This rethinking from first principles frees the committee to consider new approaches rather than minor tweaks. They will then have to think about how best to transition there."Feroli:"The 'first principles' line feels like it has the same spirit as his remark about PhDs from elite institutions not keeping money in monetary policy. Both seem to suggest the institution has let the academically driven types distract the Fed from focusing on a few basic economic principles. (Powell also didn't have a PhD but he certainly seemed less defensive about it!)"Greenhaus:"Getting back to first principles could have significant implications for policymaking. What is the Fed's mandate, and how should it go about fulfilling that mandate? Whether one agrees with this more 'originalist' approach or not, it appears to be the direction in which Warsh wants to take the institution. It suggests a more limited role for the Fed beyond monetary policy, including greater skepticism toward its involvement in areas such as regulatory policy and climate-related issues. More broadly, it implies a willingness to reassess how much the Fed's role has expanded since the Global Financial Crisis and whether that expansion has gone too far." 'Inflation is a choice, and the Fed must take responsibility for it.' Mester:"This harkens back to Milton Friedman's line that "Inflation is always and everywhere a monetary phenomenon, in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.""Over the longer run, to achieve price stability the Fed has to ensure that aggregate demand is not growing more strongly than aggregate supply. Otherwise. there will be price pressures and sustained inflation.""Note that over the shorter run there can be times when supply is temporarily disrupted and prices rise for certain goods and/or services. The Fed would want to look through that because by the time a monetary policy action would affect the economy, the supply disruption would be over — this is because of the long and variable lags of the effects of monetary policy. But when supply disruptions are longer lasting or there is a series of multiple disruptions (like after the pandemic and now), the Fed needs to ensure that monetary policy is restrictive enough to bring demand into alignment with supply or else there will be a sustained rise in inflation."Sahm:"'Inflation is a choice' is a nod to Warsh's mentor Milton Friedman, who said that "inflation is always and everywhere a monetary phenomenon." The Fed's framework already contains a version of this: "the inflation rate over the longer run is primarily determined by monetary policy." Warsh is restating something the Fed has said for years, but he is omitting the timeframe — and that omission matters. In the short run, supply shocks like energy disruptions or tariffs can move inflation regardless of what the Fed does. Warsh's phrasing is unlikely to change other Fed officials' views on monetary policy, but it might confuse the public about what the Fed can do."Greenhaus:"Taken to its logical conclusion, this suggests a Fed that is less willing to attribute prolonged inflation overshoots primarily to exogenous factors such as tariffs, fiscal stimulus, or supply shocks. Warsh's message is essentially that "the buck stops with us." As a result, Chair Warsh will [be] less tolerant of explanations for persistently elevated inflation that do not acknowledge the Federal Reserve's own role. In his view, the Fed may not be responsible for every inflationary shock, but it is ultimately responsible for ensuring that those shocks do not become persistent inflation.Feroli:"I think his phrase 'Inflation is a choice, and the Fed must take responsibility for it' sits oddly aside one of his other catch phrases 'I don't believe that we have a cruel choice.' It's a pillar of modern monetary economics that inflation is a choice that in the long run is under the control of the central bank, so not many will have a problem with his first catch phrase. (Though it's more contentious how long is the long run). But the idea that there is no short-run tradeoff between growth and inflation then begs for the question: why would the Fed ever choose inflation? The economic argument for central bank independence rests on the idea that a politically motivated central bank might be tempted to exploit that short run tradeoff to juice the economy at the long run expense of price stability.Spindel: "It's another phrase that can mean whatever Warsh wants it to mean. Totally consistent with his (and the committee's) restatement of their inflation mandate in the first FOMC statement under KW, 'the committee will deliver price stability.' Though when questioned aggressively by Sen. John Kennedy, R-Louisiana, Warsh struggled to explain exactly what he would do about that. Ultimately, he got to the rub, higher rates might be in the offing. He criticized his predecessors who he implied were comfortable with higher inflation rates. As for 'the Fed taking responsibility for it,' I agree with Chairman Warsh. At its simplest, the Fed sets the price of money, and if money is too cheap, the Fed has to act." Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

8th pay commission: Current house rent allowance rates were set in 2017 last, according to National Council – Joint Consultative Machinery. Here's why the NC-JCM has demanded that HRA be revised… View More