Michael Derby

@michaelsderby

Fed and economy reporter with @reuters.com, ex-WSJ. Failed musician, guitar holdout. Signal: michaelsderby.50

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Michael Derby@michaelsderby· 20d

Hell yes, I love M83.

Michael Derby@michaelsderby· 21d

Trump teases broadening his Iran war, even as multiple reports point to ongoing weapons related challenges for US forces and rising casualty counts. Via Reuters

21 Jul 2026 11:17:35 AM - TRUMP ON HOUTHI BLOCKADE: WE'LL SEE WHAT HAPPENS
21 Jul 2026 11:18:04 AM - TRUMP ON HOUTHI BLOCKADE: IF SOMETHING HAPPENS WE'LL JUST HAVE TO TAKE CARE OF BUSINESS

Michael Derby@michaelsderby· 23d

I don’t get Line 6. This unit looks so sturdy but like so much of the company’s hardware, it just slowly fails under the least stressful uses. Dead switches, failing screens, all for a machine that never even hit a stage. Meanwhile I’ve got Boss pedals from the 80s still doing it.

Michael Derby@michaelsderby· 23d

Fed's Hammack: "For the first time in my tenure, I’m hearing from businesses who say they think we need to take action to curb inflation, and from consumers who can’t make ends meet about a growing sense of despair." www.linkedin.com/posts/beth-h...

There is no conflict in our mandate.

Inflation is too high. The labor market is right around my level of maximum employment.

Our PCE nowcast shows core inflation at 3.3 percent after incorporating this week’s data.

Persistently high inflation is the bigger concern.

When formulating my policy view, I consider the data as well as conversations I’ve had with business and community leaders in the Fourth Federal Reserve District.

To effectively set monetary policy, I need to think about not just where the economy was, or where it is today, but also consider where things are heading in the next six or 12 months.

That’s why I have conversations with business and community leaders on the ground to learn about what the data may not yet be showing.

What I’m hearing from those conversations is that inflation isn’t coming from only one source—it’s broad based.

Business leaders point to energy costs and supply chain disruptions as factors but also cite pressures from insurance and the AI data center build up.

At the same time, I’m seeing good growth numbers and stable consumer spending.

For the first time in my tenure, I’m hearing from businesses who say they think we need to take action to curb inflation, and from consumers who can’t make ends meet about a growing sense of despair.

I go into every FOMC meeting with an open mind and one goal—to deliver the best outcomes for the American people.

Michael Derby@michaelsderby· 28d

Little guy on the beach.

Michael Derby@michaelsderby· 29d

I think I took the right week off. Anyway, I’m also imposing a toll on beach access here.

Michael Derby@michaelsderby· Jul 12

I don’t know what’s going on, Pitchfork just reviewed a Rush album.

Michael Derby@michaelsderby· Jul 10

Matt Pike out of Sleep, now Lisa Gerrard out of Dead Can Dance? It’s ok to end a band when a critical member bails.

Michael Derby@michaelsderby· Jul 10

State school grad here but I didn’t find a Clockwork Orange that bad a slog in my youth.

Michael Derby@michaelsderby· Jul 9

Fed task force chiefs have been announced and slate looks like mainstream players, which might be a relief to some mindful of Warsh's pre-chair aggressive rhetoric.

Communications: Review how the Federal Reserve conveys policy deliberations and decisions amid uncertainty.
Peter R. Fisher, professor of practice, Foster School of Business, University of Washington
Arminio Fraga, founder and chairman, Gávea Investimentos; former president, Central Bank of Brazil
Mervyn King, former governor, Bank of England
Balance Sheet Policy: Examine the costs, benefits, and institutional implications of the Federal Reserve's current balance sheet regime.
Karen Dynan, professor of economics, Harvard University
Raghuram Rajan, professor of finance, University of Chicago Booth School of Business; former governor, Reserve Bank of India
Jeremy Stein, professor of economics, Harvard University; former governor, Federal Reserve Board
Data: Improve the quality and timeliness of real economic signals that inform the Federal Reserve's policy judgments.
Raj Chetty, professor of economics, Harvard University
Doug McMillon, former president and CEO, Walmart Inc.
Kevin Murphy, professor of economics, University of Chicago
Productivity and Jobs: Assess the economic impact of new general-purpose technologies, including artificial intelligence, to inform the Federal Reserve's policy judgments.
Marc Andreessen, cofounder and general partner, Andreessen Horowitz
Charles I. Jones, professor of economics, Stanford University, currently on leave at Anthropic
Asha Sharma, executive vice president and XBOX CEO, Microsoft Corp.
Inflation Frameworks: Revisit how the Federal Reserve understands and responds to the drivers of inflation.
Greg Mankiw, professor of economics, Harvard University; former chairman, Council of Economic Advisers
Thomas Sargent, professor of economics, New York University; Nobel laureate
William White, senior fellow, C.D. Howe Institute; former economic adviser, Bank for International Settlements

Michael Derby@michaelsderby· Jul 9

The Committee for a Responsible Federal Budget on Republican finances: "We will likely borrow $2 trillion or more this fiscal year – an astounding figure given that the economy keeps growing and unemployment is low. This is likely the tip of the iceberg."

The FY 2026 deficit has now passed the FY 2025 deficit – and it is likely to stay that way for the rest of the fiscal year. After the deficit coming down between FY 2024 and 2025 due to the administration’s tariff revenue and some one-time changes in spending, the new tax cuts and spending increases are now pushing the deficit above last year’s level.

We will likely borrow $2 trillion or more this fiscal year – an astounding figure given that the economy keeps growing and unemployment is low. This is likely the tip of the iceberg; borrowing will soar if policymakers fail to get our entitlements under control, enact further unpaid-for tax cuts or spending increases, and otherwise ignore the need to cut spending and increase revenues. Social Security and Medicare are within seven years of trust fund exhaustion, and action needs to be taken to prevent across-the-board cuts to both programs.

None of this is normal. Policymakers should instead be targeting a much more sustainable deficit at 3% of GDP, putting together a bipartisan commission to address our fiscal situation and entitlements, and perhaps most importantly, being honest with the public about the grave dangers we face by remaining on this unsustainable path.

Michael Derby@michaelsderby· Jul 8

Tricky trying to parse this policy outlook from the FOMC minutes.

Regarding participants' individual assessments of appropriate monetary policy under what each participant judged to be the most likely scenario for the economy, many participants indicated that the appropriate level of the federal funds rate would be within or slightly below the current target range at the end of this year. Many other participants, however, assessed that the appropriate level of the federal funds rate would be above the current target range at the end of this year. Participants noted that their future policy actions would depend on incoming information.

Michael Derby@michaelsderby· Jul 8

A decent amount of inflation worry in the FOMC minutes.

Michael Derby@michaelsderby· Jul 8

Trump getting back into the swing of his Iran war.

Michael Derby@michaelsderby· Jul 7

Bank of America data: "Labor market momentum improved again in June, with estimated payroll growth accelerating to 1.7% year-over-year (YoY). This strength appears broad-based."

Bank of America customer deposit account data suggests labor market momentum improved again in June, with estimated payroll growth accelerating to 1.7% year-over-year (YoY). This strength appears broad-based, with job growth picking up in both FIFA World Cup 2026™ host cities and non-host cities, indicating the improvement extends beyond any tournament-related boost.

Consistent with a healthy labor market, unemployment payments into Bank of America customer accounts continued to soften in June. The number of households receiving unemployment benefits showed further moderation, reinforcing signs that labor market conditions remain resilient despite softer official payroll readings.

Lower-income households saw a rebound in after-tax wage growth, rising to 4.1% YoY in June, above middle-income households (3.4%) and nearly matching higher-income households (4.2%). Increased job switching activity, particularly among lower-income workers who tend to receive larger pay gains when changing employers, could be helping narrow the wage growth gap.

Michael Derby@michaelsderby· Jul 7

Rahm Emanuel set to unload on Israel: "The tragedy is that Netanyahu's government has helped Hamas achieve its objective." Via FT

Rahm Emanuel's 🔥🧨speech at Tel Aviv University tomorrow. "The prime minister and his government have led Israel into a dead end....Unconditional American support has allowed you to deny food and medical relief to innocent Palestinians suffering in Gaza, leaving the world to conclude that Israelis are not only willing to kill the Palestinians but are completely indifferent to their death, destruction and suffering ....You cannot indefinitely fight the world that has stopped believing you have the right to fight....Your government is complicit in the horrors now being inflicted on innocent families in the West Bank...If I have anything to say about it, every Israeli attacking Palestinian civilians or their property will be sanctioned......The tragedy is that Netanyahu's government has helped Hamas achieve its objective [to kill the 2-state solution]."

Michael Derby@michaelsderby· Jul 7

TV on the Radio's Return to Cookie Mountain is now 20 years old. For me, it's the best thing that came out of that NY rock rebound.

Michael Derby@michaelsderby· Jul 6

Some Waller-Warsh friction emerging? "WALLER: ASKED ABOUT WARSH "RECOMMITTING" TO INFLATION TARGET, SAYS HE HAS NEVER BEEN ANYTHING BUT COMMITTED"

Michael Derby@michaelsderby· Jul 6

Goldman Sachs on ossified housing mkt: "Almost 80% of mortgage borrowers have interest rates below current market rates, and almost 60% have rates 2pp below market rates, strongly disincentivizing them from moving. As a result, we expect annualized existing home sales of just 4.2mn in 2026H2."

Sustained higher mortgage rates will continue to have their most pronounced impact on housing turnover. Almost 80% of mortgage borrowers have interest rates below current market rates, and almost 60% have rates 2pp below market rates, strongly disincentivizing them from moving. As a result, we expect annualized existing home sales of just 4.2mn in 2026H2, 3% above the pace of 2026H1 but 22% below 2019.
The longstanding housing shortage has kept single-family homebuilding extremely resistant to higher interest rates, but normalizing supply-demand balances and margins for homebuilders have led to a moderate slowdown in single-family housing starts. Single-family starts have declined by 2% so far this year compared to last year but have averaged 4% above 2019 levels despite 3pp higher mortgage rates today. We expect single-family housing starts to total 0.92mn this year (vs. 0.94mn in 2025) and to end the year around a 0.93mn annualized pace.

Michael Derby@michaelsderby· Jul 6

New Atlanta Fed data shows scant prospect of Fed rate cut, pares back hike projection by a bit. www.atlantafed.org/research-and...

Michael Derby@michaelsderby· Jul 5

After he spent America’s birthday questioning whether citizens should be allowed to vote anymore, South African born Musk now wants to deport Americans he views as disloyal.

Michael Derby@michaelsderby· Jul 1

Some truth in the Instagram comments

Michael Derby@michaelsderby· Jul 1

Fed report: We're not using the ATM as much anymore but when we do, we take out more cash.

The number of ATM cash withdrawals continued to fall, while their average value reached a new high. ATM withdrawals fell to 3.4 billion in 2024, down from 5.2 billion in 2015. Over this period, the value of the average ATM withdrawal increased substantially, from $134 in 2015 to $210 in 2024.

Michael Derby@michaelsderby· Jun 30

The quiet Fed wasn't in your head. Via Deutsche Bank

Michael Derby@michaelsderby· Jun 30

Deutsche Bank reckons Fed's Warsh has got to stick to FOMC press conferences: "While we will be mindful of any noticeable differences in tone between his presser and other FOMC communications like the post-meeting statement or minutes, it would be a missed opportunity for him to cede this stage."

$Could Warsh reduce the frequency of post-meeting press conferences? His comments at the June FOMC meeting left open this possibility. We think this is unlikely but do expect their content to change markedly. In June, Warsh noted a quote from his mentor George Shultz, “Press conferences are useful. But when you have one, you want to make sure you have something important to say.” He went on to note that the Fed had important information to relay in June, related to its commitment to price stability and the formation of task forces, and that he “expect[s] more changes to come, and, and some of those might well be worthy of a press conference.” But holding press conferences on an ad-hoc rather than systematic basis would seem to inject unnecessary volatility in Fed communications, and it is reasonable that the head of the Fed should have something important to say about the economy and monetary policy roughly every six weeks. Moreover, Warsh could be presiding over a potentially fractured Committee. The press conference provides a powerful and frequent platform for him to put his stamp on the Committee’s message and frame the narrative immediately following each policy decision. While we will be mindful of any noticeable differences in tone between his presser and other FOMC communications like the post-meeting statement or minutes, it would be a missed opportunity for him to cede this stage$

Michael Derby@michaelsderby· Jun 30

Big defeat for Trump: "U.S. SUPREME COURT RULES AGAINST TRUMP'S ORDER LIMIT BIRTHRIGHT CITIZENSHIP"

Michael Derby@michaelsderby· Jun 30

Reuters: 30 Jun 2026 10:00:14 AM - U.S. SUPREME COURT RULES IN FAVOR OF IDAHO, WEST VIRGINIA LAWS BANNING TRANSGENDER ATHLETES FROM PARTICIPATING ON FEMALE SPORTS TEAMS

30 Jun 2026 10:00:14 AM - U.S. SUPREME COURT RULES IN FAVOR OF IDAHO, WEST VIRGINIA LAWS BANNING TRANSGENDER ATHLETES FROM PARTICIPATING ON FEMALE SPORTS TEAMS

Michael Derby@michaelsderby· Jun 29

I think it’s time to call it a day for New Order.

Michael Derby@michaelsderby· Jun 29

Fed defeat aside, Drudge again cuts to the heart of Trump's relationship with the Supreme Court.

Michael Derby@michaelsderby· Jun 29

Fresh off his legal defeat, Trump claims he's not done with Fed Gov. Cook: "We will take appropriate action immediately to make sure that someone who has committed wrongdoing will not be making vital decisions concerning the Welfare of the United States of America!"