08.04.2026 - A Blank Piece of Paper Right Now

A “blank piece of paper right now”

That's how Chair Warsh described his upcoming Jackson Hole keynote at the July 29 press conference, with the speech still a month away at the time.

Fair enough. Nothing stale, at least.

But the blank page is doing a lot of work these days. The balance of risks has tilted back toward inflation, and Warsh keeps insisting that "The Committee will deliver price stability."

So far, though, the Fed has let the Treasury market do the tightening for it.

The mechanic is simple: crude climbs, inflation risk climbs, and 10-year yields climb in response — no FOMC vote required.

That's more than 66 basis points of tightening from this year's low 10-year close of around 3.96% — a level last seen on the final trading day before the Iran war began.

The target range, meanwhile, still sits where three 2025 eases left it: 3.50%–3.75%.

Which is the real question heading into late August: are the markets absorbing energy shocks on the Fed's behalf, or just voicing their disappointment that Warsh has talked tough without touching short rates?