The Inflation Debate That Will Shape the Fed’s Plans for Interest Rates

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Mar 1, 2026

Rob Kaplan, vice chairman at Goldman Sachs and former Federal Reserve president, offers market insight on tariffs, AI-driven investment shifts, mortgage regulation, and Fed policy. He discusses the fallout from the Supreme Court tariff decision. He explains why investors favor HALO stocks and how AI and regulatory changes could reshape mortgages and the Fed’s rate debate.

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INSIGHT

Markets Expected Swift Tariff Replacement

The Supreme Court decision created a legal reset that the administration quickly patched with a new tariff authorization lasting 150 days.
Rob Kaplan notes markets expected the move and the administration raised rates from 10% to 15% almost immediately to stay prepared.

INSIGHT

Tariff Refunds Are Small Relative To Growth Forces

The potential refund exposure from struck-down tariffs is relatively small—around $100 billion—so market moves are more driven by growth expectations than fiscal shock.
Kaplan highlights expected 2026 GDP strength from tax incentives, depreciation changes, and an AI infrastructure boom boosting demand.

INSIGHT

AI Infrastructure Now Then Productivity Later

The AI cycle is currently infrastructure-led—chips, power, data centers—driving near-term GDP stimulus and stickier costs.
Kaplan expects a later adoption phase where productivity gains could add roughly 0.5 percentage point to annual GDP growth and be disinflationary.

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In this week's episode of WSJ’s Take On the Week, co-hosts Telis Demos and Miriam Gottfried are joined by Rob Kaplan, vice chairman at Goldman Sachs and a former Federal Reserve president, to break down some big topics in markets. They discuss the market's reaction to the Supreme Court’s decision to strike down the Trump administration's tariffs under the International Emergency Economic Powers Act. Then Kaplan explains why investors are repositioning into "HALO" stocks—short for Heavy Assets, Low Obsolescence—like McDonald’s, Walmart and ExxonMobil.

After the break, the conversation turns to the Federal Reserve’s new look at mortgage-market regulations and how freeing up bank capital could unleash funding in the housing market. Finally, Kaplan previews the March Fed meeting and the philosophical debate that will loom over the central bank under its potential new leadership: Should it wait to have inflation data in-hand or rely more on forecasting?

This is WSJ’s Take On the Week where co-hosts Telis Demos, Heard on the Street’s banking and money columnist, and Miriam Gottfried, WSJ’s investing and wealth management reporter, cut through the noise and dive into markets, the economy and finance—the big trades, key players and business news ahead.

Have an idea for a future guest or episode? How can we better help you take on the week? We’d love to hear from you. Email the show at takeontheweek@wsj.com.

To watch the video version of this episode, visit our WSJ Podcasts YouTube channel or the video page of WSJ.com