Markets & outlook · Podcast

How Will Less Fed Transparency Affect Markets and the Economy?

For wealth professionals, the episode frames a policy-communication debate that can affect how markets interpret Fed signals and volatility around incoming data. The discussion focuses on forward guidance, market signaling and how investors process Fed information.

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Summary

By the markets & outlook desk

This Exchanges episode examines the Federal Reserve under Chairman Kevin Warsh moving toward less transparency. Former Fed governors Donald Kohn and Stephen Miran and Goldman Sachs Chief Economist Jan Hatzius discuss the merits of Fed communication and how it affects financial markets and the economy. It is based on the latest Top of Mind report and was recorded in August 2026.

Kohn describes a “golden mean” in which markets get some information from the Fed, such as a narrative to help process data, without too much specific detail about policy plans.
Miran argues that reducing forward guidance would improve the signal financial markets provide and that the additional volatility is worth the trade-off.
Miran also argues that too much guidance from Fed officials can increase volatility in the longer run.
Hatzius says markets will always price what they think the Fed will do, not what they think it should do, even if the central bank provides less information.

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