In the Markets: A Tug of War between Big Tech and the Fed

But whether the current bull market has any chance of lasting will depend in large part on the Fed’s ability to tame inflation without damaging the core of the economy. And excessive exuberance in financial markets could further delay the Fed’s rate cuts, which were expected to begin now but are unlikely to begin now. June. The Fed is not explicitly targeting asset prices, but could be forced to keep rates high if a dangerous bubble emerges.

Yet continued Fed inaction would continue the pain of consumers who financed their purchases at punishingly high interest rates. These rates make the costs of housing, credit and car loans painfully expensive. It is very likely that the debt burden is contributing to dissatisfaction among voters, who are giving the Biden administration poor marks for the economy. Moreover, if consumers are left without power, the Fed’s campaign to safely steer the economy toward a low-inflation future could be in serious trouble.

Think about what happened during the meetings.

AI Woodstock

In a huge room usually reserved for San Jose Sharks hockey games and rock concerts, Nvidia CEO Jensen Huang said: told a standing-room-only crowd of tech developers, investors and business leaders announced on Monday that the future of AI had arrived for them.

As he walked across the dark stage in a black leather jacket, jeans and sneakers, Mr. Huang holding two prototype circuit boards with Nvidia’s latest super-fast chips. These are “great” products, he said. “This right here is, I don’t know, $10 billion,” he said. “The second is $5” billion.

Customers will pay less for models that don’t come off the production line, he said, without saying how much. But it does not matter. The massive investments in AI hardware will save companies money, Mr. Jensen said, because the new technology is so much faster and more efficient than the previous generation. And this annual event, which Bank of America has dubbed “AI Woodstock,” was filled with deep-rooted true believers. Hundreds of companies are already on board, Mr. Jensen said, and Nvidia’s chips, components and software will form the vibrant core of AI for years to come.