Warsh Warns: AI-Driven Bull Market 'Priced for Perfection'

Kevin Warsh, the Federal Reserve's new chairman, has sounded a warning to Wall Street and investors. In his prepared remarks after the September FOMC meeting, he expressed dissatisfaction with the pace of progress on inflation.

The Fed raised interest rates by 25 basis points to 3.75%-4.00% to combat persistently elevated inflation. Warsh noted that this summer's inflation readings do not show meaningful improvement in underlying trends.

The FOMC has historically coincided with bull markets and strong economic growth, but the current AI-driven bull market is priced for perfection and can ill afford the uncertainty brought about by a rate-hiking cycle.