WARSH’S FIRST JACKSON HOLE SPEECH: ‘WE HAVE WORK TO DO’ ON INFLATION — FED CHAIR SAYS 65 MONTHS OF IT IS THE CENTRAL BANK’S OWN FAULT, BITCOIN DROPS TO $78,700

Kevin Warsh had one job in his first Jackson Hole speech: tell markets whether the Fed is done fighting inflation. He didn’t say yes. “The responsibility for 65 months of sustained, elevated inflation sits squarely with the central bank,” he said, which is about as close as a sitting Fed chair gets to admitting the institution broke the thing it’s supposed to protect. Then came the line that moved the market: “We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do.” Translation: rates stay higher, longer, until the data agrees with him. Bitcoin took the hint and dropped from a three-month high near $81,500 to $78,700 inside the hour. There’s also a fight nobody resolved on stage — Treasury Secretary Bessent wants the Fed to help cap long-term yields directly; Warsh’s speech leaned toward letting the market set the price of debt instead. Two people in charge of the same problem, pointing in different directions, on the same morning the Fed chair admitted the last five and a half years were on him. Bitcoin doesn’t need either of them to agree. It just needs them to keep disagreeing long enough for people to notice why someone built a money that doesn’t.