Delinquencies, Defaults, Denial: The Fed’s Blind Spot Grows | Danielle DiMartino Booth

Federal Reserve Chair Jerome Powell returned to Capitol Hill this week, facing mounting political and economic pressure. Bond markets are now pricing in two rate cuts by December, even as Powell warns that inflation could reaccelerate this summer. In his testimony, Powell acknowledged that rates are now only “modestly restrictive” and refused to commit to cuts, despite rising delinquencies, falling home prices, and consumer stress.

Joining Kitco News is Danielle DiMartino Booth, CEO and Chief Strategist at QI Research and former advisor to the Dallas Fed. DiMartino Booth argues that the Fed is again behind the curve, dismissing recession signals and risking another policy error. She outlines her thesis that the U.S. economy is already in contraction, student loan defaults are accelerating, and housing weakness could soon drive inflation lower.

Key topics:
-Powell’s testimony and the July rate cut debate
-BLS job revisions and labor market deterioration
-Student loan delinquency crisis and GDP risk
-Housing price declines and shelter inflation
-Tariff-driven input costs and policy paralysis
-Credit crunch signals and market dislocation
-What would shift her outlook to ‘stabilization’

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00:00 Introduction
00:52 Powell's Testimony and Market Reactions
02:14 Interview with Danielle DiMartino Booth
04:56 Student Loan Crisis and Economic Impact
08:21 Housing Market Trends
11:46 Oil Prices and Geopolitical Factors
13:00 Fed's Policy Dilemma and Market Expectations
19:20 Conclusion

#FederalReserve #DanielleDiMartinoBooth #InterestRates #Inflation #StudentLoans #Recession #HousingMarket #Gold #KitcoNews
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