SIX DAYS
There is a thing everyone knows about central banks and elections, and it is not true.
The thing everyone knows is that the Fed goes quiet near a vote — that it will not move inside the window where moving looks like taking a side. You are hearing a version of it this week: Warsh should hike in September, and if he doesn't go in September he certainly can't go in October, because the midterms are November 3.
The October FOMC concludes October 28. That is six days before the vote.
THE RECORD
November 2, 2022. The FOMC raised the funds rate 75 basis points. The midterm was November 8. Six days.
September 26, 2018. The FOMC hiked. The midterm was November 6. Six weeks. Then hiked again in December, over loud public objection from the sitting President.
The Powell Fed faced two midterms and tightened into both — once by three quarters of a point inside a single week of the polls. Whatever restraint the calendar is supposed to impose, it did not impose it.
The presidential cycle is where the argument actually lives. September 18, 2024: fifty basis points, seven weeks out. That one drew the accusation, and it drew it from the opposite direction — same structural charge, that the Fed was timing policy to a vote, filed under politics rather than markets, and largely gone by December.
We are not interested in who was right. We are interested in what the premise is worth. And the premise is worth nothing. It is a folk belief that the people repeating it have never checked against the tape.
SO PRICE OCTOBER ON ITS MERITS
The funds rate is 3.50–3.75. Inflation is 3.4. The real policy rate is roughly a quarter point — the stance is not restrictive, it is barely neutral. The chairman said Friday he has work to do if inflation stays where it is. Three regional presidents already voted to hike in July. September is a coin toss.
If September passes, October 28 is live. The only argument against it is a calendar superstition the last chairman disproved in front of everyone.
The two-year closed at 4.35, up eleven basis points — its biggest one-day rise since June. The thirty-year closed lower, at 5.21. 2s30s flattened twelve basis points in a single session. Gold fell three percent. That is what a market looks like when it decides a chairman means it.
If October is live, the belly is not done.
Six days. It has been done before. It will get done again.
Source data: Koyfin, pulled 29-Aug-2026 09:34 ET (28-Aug closing levels). FOMC action dates: Federal Reserve policy statements, 2018–2026, and the Federal Reserve's 2026 meeting calendar. Election dates: Federal Election Commission. Warsh speech coverage: CNBC, Bloomberg, The New York Times, 28-Aug-2026. Prior edition referenced: "The Curve Already Answered," 28-Aug-2026.
Produced with AI assistance. All data selection, analysis, conclusions, and final editorial judgment are the author's. All content is reviewed and approved by Positive Carry LLC prior to publication.
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