Wonderful to speak to you again.

Jim.

I'll cut right to the chase.

You change the economic dialogue a number of years ago with the request that we find regime change.

Are we at that moment right now where there's literally a regime change in our economics where the Fed has to shift the way it does business?

Well, I think, uh uh, for Europe, the E C B is facing a difficult situation.

So you might look at that as a zey crossroads to sort of speak of monetary policy for the U.

S.

I think we're generally speaking in good shape.

I have emphasized that we face some downside risk from the trade war, and I've tried toe encourage the committee to take action which we have thio try to mitigate those risks and keep us on even keel in the U.

S.

What is the urgency of the next number of meetings?

We see some houses saying one and done, and I don't want you to gain the Fed.

I know that's not part of the dialogue, but we too, focused on the one next meeting, October 30 versus the What ifs of December 11 and into 2020.

I think we'll go on a meeting by meeting basis here, uh, the committee has taken two moves on.

And if you look at my remarks this morning, I think we've moved a lot in the last year.

If we were sitting here a year ago, we would have been talking about the Fed raising rates in 2019 not lowering rates.

And instead we during January February, we said we were taking the interest rate hikes off the table and then getting into June, July, September, we started talking about reducing rates so that shift in monetary policy in the U.

S.

Has been quite dramatic.

Over the last year, I'd say 125 135 basis points, not just the 50 basis points that we've had.

So one part of what we need to do is take stock of where we are.

But I think also we have to consider additional insurance in the meetings I had.

So should the Fed be more aggressive, given the risks to the economy, Well, I mean, if you if you buy the argument that I just made, we have been pretty aggressive and normally you would think with long invariable lags and policy that it would take a while for those things toe have an impact on actual hard data in the U.

S.

I would expect those kinds of effects to come online during the second half of 2019 the first half of 2020 and you are seeing some of that in housing markets.

For instance, where say refinancing activity and other things have picked up, But you dissented in favor 1/2 a point cut instead of the quarter point conscience.

Did you still think next time around that we need half 1/2 a point cut?

Uh, generally speaking, I'd like to do Maur, but I don't want to prejudge the meeting.

It's Ah, let's let's get to the meeting and make a decision there.

Jim Bullard are Michael McKee enjoys being in the press conference, and the long invariable lags when he has the question and Chairman Powell and he really doesn't get a chairman like answer.

So we're gonna try you right now.

What is the efficacy of road?

You have some coffee there.

The coffee's better in London, by the way, in ST Louis, or New York.

It's over here, Tom.

Move over here that it's been considered as well.

We can't fly vet Bill over there.

We welcome all on Bloomberg Radio, Bloomberg Television to this conversation with Jim Buller.

Jim Seriously, Michael McKee has asked and asked and asked the simple question.

What is the efficacy of rate cuts with an economy that's doing pretty well or pretty darn good?

Or his vice chairman Clarita says Salad, what is the the good that we can get out of these rate cuts?

Well, he's always have, ah, impacts on the margin.

That's the way monetary policy works.

And I would say to those that say the U.

S economy is doing pretty well.

I would agree in the sense that consumption looks pretty strong and labor markets look very good in the U.

S.

But those air lagging indicators you'd be looking backward if that's all you looked at that you have to look up forward and think about the risks that might lie had.

And I think financial markets are a great place to look at what might happen going forward, and that's what I've tried to bring some financial signals to greater prominence in monetary policy discussions like slope of the yield curve.

Jimbo, let me get some indie academics out of this.

We talked to Michael Spence in the last hour.

The laureate from Stanford in New York University.

Can monetary policy assuage a trade war?

Can you guys fix the pain and the agony of a trade war?

Well, I got this a question a little earlier today also, but obviously we can't do anything directly about trade.

But we do have our mandate to maintain high employment and low inflation.

And we're trying to do the best we can to take on board what's going on with the trade, war and other risk to the global economy into the U.

S.

Economy and conduct a monetary policy that will help us meet our objectives the best we can.

And frankly, we've been meeting, uh, you know, you certainly have a great labor market, but the inflation side has been somewhat week.

We've been below target.

Inflation expectations remain below target.

I'd liketo re center inflation and inflation expectations back at our 2% target.

I think that would be a great outcome.

What's your read on global growth?

in trade negotiations.

Are things getting better or they getting worse?

Uh, what we're seeing is day to day tit for tat, which is a normal part of any negotiating situation.

That's what the game theory tells you is gonna happen.

We can't as policymakers be reacting day today because that would just create even more uncertainty around trade in around monetary policy.

So I think what we can do is take on board the idea that the 50 year, 75 year consensus about the US pushing toward more and more trade the liberalization has broken down and that we have more trade uncertainty and businesses are gonna have to take that uncertainty on board.

And they're gonna have to devise business strategies that cope with the high degree of uncertainty that exists in this arena.

James Bullard.

I know you don't want to talk too much about the next meeting, but according to the minutes of the last meeting, the FOMC is of course, discussing when it should end its insurance rate cuts.

Could it mean that week should be looking for a change in language to indicates after this meeting that the bar is actually higher for extra cuts.

Uh, well, I'd leave that to the chair.

That's what he gets paid the big bucks to Dio.

We'll see where the committee comes down on that.

I think, uh, we obviously do use language changes on have in the past, but whether anything would be brewing and I don't know again on Bloomberg Radio, Bloomberg Television in conversation with Jim Bullard, many on radio.

You know what the dots look like?

Let's bring it up right now.

Dot's go.

I sort of an ugly chart.

McKee loves us.

He's got it in this kitchen.

While Jim Bullet Dakota Hudson doesn't have a dot on here.

You'll be starting for ST Louis tonight.

Where's the buller dot And there are we done with the dots?

Are we gonna move on from the dot?

Uh, we've talked before.

I'm not really a fan of this dot plot, but we're stuck with it, I guess I think we're trying to give the best indication we can of what we think might happen over the forecast horizon.

I don't think that that plant probably reflects the true degree of uncertainty that exists there.

Um, I've put my ideal scenario is that we do this insurance now, but that the economy actually grows pretty well and labor markets continue to be strong and 2020 and maybe 2021 then we're able to actually take thes rate cuts back at some point in the future.

That's what happened during the 19 nineties, and so if I'm just putting out my base scenario, then that's what I'd say.

I hope that's what happens.

But on the other hand, I wanna lower now because I think we want to take out insurance against these risks and the idea that the trade war might morph into something more serious for the U.

S.

Economy.

Jim Bulletin.

Every conversation I have from the youngest market economists out to the new managing director of the IMF, people are talking about confidence about the will to move forward into 2020.

What is the state of business confidence in the ST Louis district?

Uh, certainly for agriculture and manufacturing, especially, and some other businesses as well.

They express a lot of angst about trade issues, and I get a lot of stories detailed stories about how it affects particular markets.

I think that's ah, Major concern.

Overall business conditions, however, especially for domestic facing businesses, remain good, and they're cautiously optimistic going forward.

But they are concerned about about that policy.

The trade policy issue.

This is a very Tom keen question, Tom.

We've been anchoring together for way too long.

There's a debate on whether current Fed policy is slightly contractionary, slightly stimulative or neutral.

Which one isn't?

Uh, I'd say we're at neutral and might be able to get to slightly accommodative soon, but that's because I have a lower so called our star than other people have.

Um, so I would say the neutral policy rate is somewhat lower for me than than what it would be for other people.

Um, how behind the curve is the Fed?

Yeah, I don't know.

For behind the curve.

I think we did take a lot of action over the last year, as I was describing earlier.

And so I think I think we've taken on board the idea that these risks have been brewing, and I think that's important whether we've got exactly right.

Of course, you never know.