Fed Should Slash Rates by 125-150 Basis Points in 2024, Argues Steve Miran in Bold Bloomberg Interview

• Why Is Steve Miran Pushing for Dramatic Fed Rate Cuts?
• What Shocked Miran About His First FOMC Meeting?
• How Are Migration and Savings Reshaping the Rate Landscape?
• Why the Urgency for 50 Basis Point Cuts?
• What's the Three-Year Immigration Story Few Are Discussing?
• Would Miran Stay at the Fed If Asked?
• FAQs: Steve Miran's Rate Cut Argument Explained

In a striking Bloomberg interview that's making waves across Wall Street, economist Steve Miran has called for aggressive Federal Reserve action, advocating for 125-150 basis points of rate cuts this year. His warning? That delayed easing could trigger rising unemployment and undermine the Fed's dual mandate. This DEEP dive examines Miran's controversial stance, his surprising FOMC meeting revelations, and why he believes migration patterns and fiscal policy demand immediate monetary response.

Why Is Steve Miran Pushing for Dramatic Fed Rate Cuts?

Miran isn't mincing words: "The longer that policy stays excessively restrictive, the greater the risks to the downside for the economy." His call for 125-150 basis points of cuts in 2024 stems from a conviction that current rates are strangling growth. The economist paints a vivid picture of policy turning screws tighter each day as neutral rates fall - a situation he compares to "driving with the emergency brake on while the road slopes downward."

What Shocked Miran About His First FOMC Meeting?

Behind the marble walls of the Eccles Building, Miran discovered something unexpected: "Everyone was extremely friendly and collegial." This warmth surprised the newcomer, who'd prepared for cutthroat policy debates. His description of Fed culture reveals an institution where "persuasion, not politics" drives decisions - though whether that collegiality extends to his radical rate cut proposal remains to be seen.

How Are Migration and Savings Reshaping the Rate Landscape?

Miran's analysis hinges on two seismic shifts: fiscal policy U-turns and immigration swings. "We had the biggest positive population growth shock in my lifetime, and now it's turned into the biggest negative," he observes, arguing the Fed's playing catch-up with these demographic earthquakes. His housing market focus provides concrete evidence: "A 1% increase in immigrant renters leads to a one percentage point change in rents," citing economist Albert Saiz's work. With migration patterns reversing, Miran sees shelter inflation pressures evaporating.

Why the Urgency for 50 Basis Point Cuts?

"Policy's quite restrictive. I'd like to adjust quickly," Miran states bluntly. His prescription? Front-loaded 50 basis point moves to avoid economic whiplash. This isn't about predicting collapse but preventing it - "If you wait to see the result, you've waited too long." The economist draws a sharp distinction between persistent inflation (from national borrowing sprees) and one-time price jumps (from VAT/tariff changes), arguing the Fed should only respond to the former.

What's the Three-Year Immigration Story Few Are Discussing?

Miran reveals a longer-term perspective: "I expect the immigration story to persist for another three and a half years." This timeframe suggests structural, not cyclical, impacts on neutral rates. His analysis implies today's policy settings might be mismatched with tomorrow's labor realities - a mismatch he believes could cost millions of jobs if unaddressed.

Would Miran Stay at the Fed If Asked?

When pressed about his future, the economist strikes a patriotic note: "I love this country and I'm happy to serve...in any way I'm asked." The carefully worded response leaves room for interpretation, much like his monetary policy views.

FAQs: Steve Miran's Rate Cut Argument Explained

Why does Steve Miran want such aggressive rate cuts?

Miran believes current policy is excessively restrictive given falling neutral rates, primarily due to reversed immigration trends and fiscal policy changes. He warns delayed action risks unnecessary economic damage.

How does immigration affect interest rate policy?

Miran cites research showing immigration directly impacts housing costs (1% more renters = 1% rent increase). With migration patterns reversing, he argues shelter inflation pressures are easing dramatically.

What would trigger Miran to abandon his rate cut position?

He'd reconsider if inflation stemmed from sustained national borrowing increases rather than temporary factors like tax changes or tariffs.