I know the 'long-AI' crowd is throwing a tantrum, but Kevin Warsh is exactly what this economy needs right now. We’ve been coasting on cheap money and hype for too long. With PCE hitting 3.7% and core inflation proving incredibly sticky due to current trade tariffs and geopolitical friction, the Fed’s pivot toward a potential rate hike isn't just 'hawkish'—it's necessary.

As an analyst, I’m seeing too much capital misallocated into speculative AI infrastructure that hasn't proven its ROI. We need to stop acting like a 2% inflation target is a suggestion. The market is pricing in a 'higher for longer' era because the fundamentals demand it. I’d rather see a tactical reset in the S&P 500 now than a full-blown inflationary spiral later.

If you’re over-leveraged in tech, that’s on you. Warsh is signaling that the Fed’s priority is price stability, not protecting your portfolio’s valuation. It’s time to stop chasing growth at any cost and return to fiscal discipline. The AI rally was a sprint; managing the macro environment is a marathon.