Intro
Former Kansas City Fed President Esther George assesses the transition to a new Fed chairman at Jackson Hole, says the inflation data is not moving the way the committee wanted and now demands a response, and explains why the last round of rate cuts left her uncomfortable. She also describes how dissent works around the FOMC table, Kansas City's turn as a World Cup host, and what consolidation has done to farm country.
Guest: Esther George, former President of the Federal Reserve Bank of Kansas City
Published: 28 August 2026 on Bloomberg Talks
Listen on Omny | 6 min
Key Takeaways
Inflation is not turning the committee's way, and that requires a response
"It is continuing not only to be sticky, but to press forward."
What everyone is watching is which form the response takes: "Is it words? Or is it an action with the tool that the Fed has?"
The rate cuts after the last meeting were uncomfortable, even if she won't call them a mistake
"I might be in the camp of saying those were a bit uncomfortable to me, given the pace of the economy, the level of inflation at the time"
Faith in the Fed exists but has to be renewed
"I think they do have faith in the Fed, but that is not an evergreen situation"
The standard she cites from past Jackson Holes: "it is important to be clear with your words, but it is more important to be clear with your actions"
Dissent around the FOMC table is the process working, not a family fight
Consolidation made agriculture more productive and changed the small communities of the heartland
A New Fed Chairman's First Speech at the Podium
Asked what she was looking for at this year's conference, George said she always comes for the substance of the topic, and took the show's ribbing about whether stablecoin was really why she was there
When the Fed chairman opens Jackson Hole, everyone in the room leans in — she said the audience listens depending on what is going on at the time, and that today is certainly one of those days
The show noted the conference was a little more lightly attended heading into the G20, with fewer international central banking leaders than in previous years, and said it felt different with people wondering where the zeitgeist on the Federal Reserve actually is
George put the difference down to the handover: it is always different when a new Fed chairman comes in, this is a transition, and this is his first speech at the podium
She said the chairman had signaled at the last FOMC press conference that he was going to talk about big questions, and that everyone is now speculating on what those questions are
Inflation Is Pressing Forward, and That Requires a Response
The show came at agriculture through the bank's history, saying it would not put the question to the current Kansas City Fed president, President Schmid, and pointing to where wheat prices are going right now
It asked how much dissent to expect between reserve bank presidents and board governors given the data ahead, and what the new character of that dissent will be, naming Wayne Angell
George answered from the heartland: you are very focused on agriculture there, but you are also thinking broadly about what high prices mean for the long run in the economy, which she called the mandate of the institution
The data is not cooperating — she said the inflation numbers are not turning in the direction the committee had hoped: "It is continuing not only to be sticky, but to press forward."
That, she said, requires a response, and the open question is which one: "Is it words? Or is it an action with the tool that the Fed has?"
How Dissent Actually Works Around the Table
The show compared the committee to the Supreme Court discussing a case before it is decided, and asked whether dissenters talk to each other and go back and forth between meetings
George said everyone has every opportunity at the table to have a frank discussion about their views and to engage with one another
Asked whether the New York Fed president had ever looked at her as if to say, oh, Kansas City, she said: of course
She would not call it a family fight, but said those decisions demand the kind of debate the committee has at the table, and has to have, especially at times like this
Why the Last Rate Cuts Were Uncomfortable
The show asked whether most people now agree it was a mistake to cut rates by 75 basis points after the last FOMC meeting at Jackson Hole, taking the rate from 4.5% to 3.75%
It said inflation has picked up by any metric since then, and that allowing for all the exogenous factors people cite, the numbers still look like the Fed is further from its ultimate mandate of price stability
George would not say most people think the cuts were a mistake, but she put herself in a different camp: "I might be in the camp of saying those were a bit uncomfortable to me, given the pace of the economy, the level of inflation at the time"
What the cuts changed is the question now being asked — whether anyone really believes policy is restrictive right now in the way they did at the time those rates were being cut
Faith in the Fed Is Not Evergreen
The show asked how the Fed restores credibility, framing it as more than the political overlay around Fed Chairman Kevin Warsh, and citing the fact that the Fed has missed its target for more than five years
It added a market observation of its own: the dollar is not rallying even in the face of an oil shock that should otherwise be dollar positive, which it said raises the question of whether people still have faith in the Fed
George said the faith is there but conditional: "I think they do have faith in the Fed, but that is not an evergreen situation" — it requires the committee to follow through and to take the actions
She pointed to the standard set in papers at past Jackson Holes: "it is important to be clear with your words, but it is more important to be clear with your actions", and said that is what people are watching for right now
From the World Cup to the Emptying Out of Farm Country
The show turned to the Kansas City World Cup events, which George confirmed she was knee-deep involved in, raising the attention paid to MetLife, a view that it should have gone to Mexico, and the comments about Kansas City getting it right, particularly with Argentina
George called Kansas City the smallest market ever to host a World Cup, certainly in the U.S.
She said it was an important event for the city, that the people of Kansas City and that region loved it, and that the guests who came and base camped there did as well
The show noted the city has a new airport and is booming, then raised the worry about the loss of population across agricultural farmland and asked what agriculture in this nation looks like five and ten years from now
George started from agriculture's size in the national accounts: a small percent of U.S. GDP, and a sector whose weight is clearest in the heartland
The demographics have changed over time and the industry has consolidated, which she said has made it more productive overall
The same consolidation reshaped the towns: it has really changed the dynamics in many of the small communities that populate that part of the country
The show signed off by noting George formerly led this event, and had what some people call the Willy Wonka game of handing out the golden tickets, because everybody wants to get in
George's bottom line is that inflation is still pressing forward rather than fading, that the cuts made after the last meeting sat uncomfortably with her at the time, and that the Fed keeps the public's faith by following through with actions rather than with words.
Products, Companies & Tools Mentioned
Federal Reserve Bank of Kansas City (George's former bank and the system's agricultural Fed; the show asked what dissent will look like there now under President Schmid, and she framed her answers from the heartland's vantage)
Federal Reserve and the FOMC (The institution whose mandate she says is to think about the long run; inflation is not turning the committee's way, and whether the response is words or the rate tool is the open question)
Federal Reserve Bank of New York (Asked whether its president had ever looked down on Kansas City, George said: of course)
The World Cup in Kansas City (George was knee-deep in the effort; she calls Kansas City the smallest market ever to host the tournament, certainly in the U.S.)
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