By Michael S. Derby
NEW YORK, Aug 3 (Reuters) - Reuters spoke with Williams on July 31, two days after the latest policy meeting. A full transcript of the interview follows, lightly edited for context and clarity. To see the related story click here.
Michael Derby:
I wanted to start out talking about inflation because that was obviously one of the key issues with the FOMC meeting. I've been to your speeches and followed along with what you've been talking about inflation. Now the war is back on again
in some capacity, what are you thinking about the outlook for inflation right now? You know you had this idea that it was going to moderate over time, but do you still feel that way?
John Williams:
I would, I still find it useful to kind of separate the three categories of factors that are causing inflation to be elevated, and I'll come back to one of them, is definitely the conflict in the Middle East.
But I'll start with the tariffs. I think what we've seen on the tariffs is that probably the vast majority or large part of the effects of the tariffs that are in place have now passed through into to prices in the U.S. economy. That's I think consistent with the kind of, all the research we've done on this and the, and the data we've seen. So I think that those effects, which have been pretty sizable on inflation, we should not see large effects from tariffs on inflation rates in the coming months anymore. Assuming that the constellation of tariffs doesn't significantly change, I would say that on that, the newly announced tariffs, which really were replacing some of the expiring tariffs, on net, this is a relatively modest increase in the average tariff rate. So it doesn't really change my view on the effects of tariffs fundamentally. I think that those effects have mostly played out in the data we've already seen.
In terms of the conflict in Middle East clearly is a situation that does change day to day, week to week, and so we've seen the situation lead to higher oil prices and the closing of the Strait, and so that's just something that obviously will affect energy and commodity prices for a while. The futures markets, and some experts, still expect that there will be a resolution to that that leads to the reopening of this trade or reopening of trade in energy and other commodities, and so therefore expects those commodity energy prices to come down later in the year, we'll have to wait and see. I would still say that's part of my, if you will, my base forecast. But that's one I don't hold of energy prices ...
Derby: Moderating?
Williams: Moderating somewhat, or basically having essentially already peaked. Now it's just a question of you over what time period do they moderate, and what price do they come to? So I think, from my point of view on this, I'm not putting a great deal of certainty or confidence in any particular forecast of energy prices. But I don't anticipate, at least based on what's happening so far in my base case, that we're going to see continued inflationary push in the second half of the year or the next year from the from the conflict in the Middle East. But that's something that obviously could change depending on circumstances. But definitely relative to some of my earlier comments, oil prices are higher, and I think the path of future path of oil prices is also somewhat higher.
But the third category, which I think is important, is the effects of very strong demand related to AI. We can talk more about that. But I think that's just one area that I'm watching carefully. It's not a big driver of inflation right now, but is clearly something that we're seeing, certain categories of goods and being pushed up by the very very strong demand that's right now at pace and supply.
Derby:
In some of your speeches, you talked about how the energy market was priced for a benign outcome, and one thing I've been watching is this inventory story and the oil doomers, their forecasts have not come to fruition so far. But there's this idea that the longer this grinds on, we grind down through the inventories, that eventually there could be just a really bad situation. So I know it's hard to second guess markets, but do think markets are appropriately priced given this inventory situation, or do you think they're underpricing the risk that exists out there for energy?
Williams:
First of all, I do think that the market, and I think all experts recognize, there's a lot of uncertainty about these issues, about kind of how this will play out. So, are they underpricing the risk? I can't really speak to that.
I will say one thing that when you talk to people, when I talk to people in the markets, I mean, they're very aware of all the inventory issues. We started, actually before the conflict started, we had a pretty high level of oil inventories around the world, which I think lessens some of the effects that we saw early on. We've definitely seen developments where countries have tapped into strategic reserves. We've also seen other factors that I think have lessened somewhat the impact of the closing of the strait on world oil prices because either more supplies come from other areas, or demand has actually come down in some areas, so I think that's been one of the mitigating factors there.
I think that when you talk to people in the financial markets, especially around why are they not as worried as you might expect about the running out of inventories is, I think they often point to, well this is understood and at some point this would be, would lead to very very high oil prices and things and that would be part of an argument why various parties would want to come to a resolution of this and I would say on both sides. I mean, the cost to the various countries involved in this goes up if we get to that point.
But again, those are just points of view that market participants make. So I think the thing that I do draw from this is they're fully aware of all the data and how much the inventories are, how much is out of ships and things. It's really, I think they're very focused on how does this, how is the conflict resolved, what's the timeline for reopening trade in oil and commodities. And then, what we did see when earlier in the year when this trade was reopened, we actually saw, I would say, a more rapid kind of normalization of movement of ships through, energy prices came down quite a bit.
So I think that there's also some confidence that if this can be resolved, we can maybe get back to normal maybe a bit quicker than some people had previously thought. Again, these are highly uncertain things, and I think everyone recognizes that. But I think that's kind of how the markets are looking at, recognizing that eventually these inventory issues will become much more front and center.
Derby:
So if you had to sum up the inflation risk outlook, has it gotten worse since, say, the June FOMC meeting, or is it about in the in the same area?
Williams:
It's about, in my view, of course, I'm always speaking from my perspective. It's, I think similar to the June FOMC over these six weeks. My view on the economic outlook actually hasn't changed that much more generally.
I think, one, is if you go back to the June time frame, that was actually a time where oil prices were actually still pretty elevated. So the situation has, it's changed in between, but we're a similar situation. I would say that I think in terms of what we've seen in terms of the tariffs and also the inflation data, I think are more are consistent with kind of what I was, kind of had in my baseline forecast. So basically, it's similar to what I had seen in June, recognizing the great deal of uncertainty.
Derby:
So that would get us back to 2% inflation in 2028. I believe that was your last comment on that.
Williams:
I think again in my base case, and there's, we can talk about where things can go wrong in that base case, but assuming that energy prices have basically peaked and will come down gradually or come down over time, assuming that the tariff effects have also peaked and we won't see those affecting inflation rates in the future, and assuming that we keep the economy or the economy remains in a good macroeconomic balance in terms of the labor market and more generally, I think that some of the big drivers that pushed up inflation over the past 18 [months], year and a half or so will not be at play as much, and then some of the disinflationary forces that we've been seeing also kind of in the background, like lower housing costs, that that will continue to support a disinflation.
Goods inflation can get back to rates that are kind of more normal around zero, or even slightly negative. And then, watch core services inflation, excluding housing, also to gradually come back down. So I think that that base case is still there in terms of, it's not really focused on energy prices because that's going to depend on what happens in the Middle East and that can change. But I am quite honestly focused quite a bit on what are we seeing in the core inflation data over the next several months, and is that consistent with a kind of a run rate of inflation moving towards 2% and really on a disinflationary path consistent with us achieving our 2% inflation goal on a sustained basis by 2028.
Derby:
I'm sure, as you know, this morning your colleagues were putting out their dissenting statements explaining why they thought Fed should raise rates, should have raised rates on Wednesday, and [Minneapolis Fed leader] Neel Kashkari even talked about the idea of maybe even talking about a gradual path of rate rises. So what is your reason why, given inflation being as above target, being above target for as long as it's been, why did you not you argue for the Fed, why didn't the Fed raise rates on Wednesday? What's the case against raising rates right now?
Williams:
Well, and of course I'm speaking from my own my own perspective, I strongly supported the decision of the committee, and there was strong support for that. I think that, from my perspective, the labor market is, been stable. Growth has been solid, but not more than solid. I mean, GDP growth over the last year was 2%, it's a little less than that in the first half of this year. So we're not seeing the economy show any signs of overheating in terms of labor market, in terms of growth. We're seeing economy that's growing more or less at trend, and that's why the unemployment rate has been near constant for about a year.
So I think that's, from my point of view, we're not seeing signs that I think are adding to inflation from where the overall economy is. I think that the big drivers of inflation, the primary drivers of inflation over the last year and a half, really have been from these specific sets of circumstances around the tariffs, around some of the uncertainty, geopolitical events, and obviously the kind of conflict in the Middle East.
In my base forecast, we should see those factors diminish in terms of the fact of inflation, and we should see the underlying disinflationary trends, which I think were present earlier and are present in the data, to continue. Now that's a-- and I think monetary policy currently is well positioned in where we are today to support that disinflationary path.
I think that that's why the case is, we have is really very forward looking. It's not looking backwards, but it's looking, where is the economy today? Where is the economy going, is likely to be in the next year or two? Given that monetary policy takes, it takes time to have its full effects on the economy, and as I've said, my forecast personally is for inflation to come down in the second half of this year and come down further next year. And so it's really about thinking about what's the right monetary policy, given where the economy is headed. I think that's how I view the case for that.
And obviously, there's scenarios where that doesn't happen, my base case doesn't happen, and we could get different factors that drive inflation higher or even lower. Or factors that affect the overall health of the economy and the labor market, and that would, you can change the outlook and change kind of the assessment of what the appropriate monetary policy is.
But from my perspective, it's really looking at the totality of the data. It's looking at all the data, all the information, labor market growth, inflation, all the factors that affect inflation, including wages and other things. Looking at the outlook, looking forward, being forward-looking, but also looking at the risks to achieving our goals. And from my perspective, I think that that base case is actually, is one where we achieve our goals, we do get inflation, absolutely get inflation back to target on a sustained basis, and maintain in a labor market that's close to most estimates of maximum employment.
Derby:
Is there a change in the economy that you think could happen, if inflation does not moderate, would you start to move towards thinking where it goes back up again? We might get higher inflation readings. Would that change your outlook and make you think perhaps it might be time to raise rates?
Williams:
Well, I think that first of all, we all agree here that we absolutely need to bring inflation back down to 2% That's a foundation, just foundational in terms of achieving, I think, a strong basis for economy. So we absolutely need to, are committed to bringing inflation back down to 2%. So that's that, I'll start from there.
Now the question that you're asking is, depending on circumstances, what does that tell you for monetary policy? I think again, it would depend on looking at all the information, what it means for the outlook and the risks to achieving our goals.
But of course, at the end of the day, if the economy is not on a trajectory that will bring inflation back down to 2% and we would, in my view there would be, it would absolutely be appropriate to act to get us on a trajectory that does bring inflation back to 2%. I don't think now, what that situation might be or how, what it would be. I think it depends on the circumstances, but I think that I start from the commitment to get inflation back to 2% and if policy needed to be adjusted to ensure that that happens, obviously that would be the right thing to do.
Derby:
So financial markets are clearly expecting you to do something in September, and the bond market has moved in the way that you know that it has moved. Do you feel a disconnect with what markets are thinking, or do you feel the market outlook for monetary policy is reasonable based on the data?
Williams:
So obviously, a very important job here for me and my colleagues at the New York Fed is watching and monitoring and analyzing very closely developments in all financial markets, and that's an important part of what we do. And the reason we do that, in part, is it affects the economy. Financial conditions affect the economy. But also trying to understand how financial markets are digesting and assessing all that information that we get around what's going on the economy and what it means.
So that's a very important part of what we do, to understand what's happening in the economy and when and why, at the end of the day, that's useful information. Talking to market participants, understanding what's going on is important.
But at the end of the day, the FOMC's job is to achieve maximum price stability, maximum employment and price stability. So we need to make the decisions at any meeting that we have that we feel will best achieve that. So I think of these as two important components of what you do. And a central bank one is understanding what's going on in financial markets, what it means, and then taking that information along with all the other information we have, and then deciding on, deciding for ourselves what's the right thing to do.
So to answer your question, I mean, I look at what's going on in financial conditions, in the market reactions to news, and whether what I see is, the markets are responding here, we're thinking about say Treasury markets are responding to the economic news, they're responding to geopolitical developments and oil prices and what's happened in the Middle East and they're responding to a lot of different factors and I don't, I don't opine on whether they're right or wrong because I don't know.
There's a wealth of information that markets are responding to. But what I've seen in the pattern is, in the data is, that you know markets are kind of trying to figure out what's going on with the economy in terms of growth, in terms of productivity, in terms of inflation, that they're looking at that information and digesting it and coming to their conclusions, and that's what they should be doing, and of course that's what we do too.
Derby:
So it's a data point for you that you definitely are watching, are mindful of, but you as a policymaker will independently make a decision on what you think, you don't you don't necessarily feel that you have to ratify?
Williams:
Oh, absolutely not. Okay. I don't think there's a, I think that we just have to come every meeting, we always have to come, do our own analysis, do our hard work, assess all of the factors influencing the economy, the outlook, and really just focus at the end of the day.
We have a pretty straightforward goal of around maximum employment, price stability. We've set the price stability goal to be the 2% PCE inflation rate. We know what we know, where we are today. We know where we need to get to. So it's really just assessing, how do we best do that. And of course, what's happening in financial markets is an important part of that transmission of monetary policy back to the economy, and so that's how I see it.
Derby:
Does the rise in long-term yields create some restraint that you actually think is helpful right at the current moment for getting inflation down? Is this the rise in long-term yields, is that helping the mission to get inflation down?
Williams:
Obviously changes in financial conditions, whether in yields or in the equity markets or in all the other markets, affect financial conditions. Those affect the cost of borrowing or returns on assets that households and businesses face, or it affects people's decisions, affects the economy in some ways. I never like the phrase that the markets are doing the work for us because I know that we have to do the work ourselves, but sure, those are factors that affect conditions, and we're aware of that. But it doesn't tell us what to do.
Derby:
Gotcha. So one of the new hallmarks of the [Fed Chairman Kevin] Warsh era is that, at least from the chair, he's not providing forward guidance, and not even a lot else to help markets understand, at least from the chair's position, what is going to come, will happen with monetary policy. Do you agree that markets are offering a pure signal now, given that they are not getting the guidance from the chair? Are markets providing a pure signal on what investors think is likely to happen without this top-level guidance from the chair?
Williams:
Well, let me just say what I see. I mean, I think I’ll just repeat what I said. Clearly, you watch, to give an example, when economic data that are materially relevant are released and whether it's a CPI, employment or any data, or important geopolitical events happen, the markets respond to that and that's an important signal of how they're assessing kind of the impact and meaning of that for the economy and more generally. So I think that is happening. I think that's something again that we follow closely, and that's I think a healthy thing for the markets to be doing.
I think that at the same time, market participants, especially when you think about rates kind of markets, they're all, they're always thinking about okay, so how does this change in data or information, how does it also affect their views on where monetary policy, where interest rates would be? So they're doing that, but they're doing that assessment, on their own.
To your point on forward guidance, I think the big change here really is, and the committee strongly supported this in the June meeting, and I did too, is that forward guidance of the kind of explicit “let's tell you what we think we're going to do, we're leaning, which way we're leaning” just wasn't appropriate anymore. That's I think, that was exactly the right call because the uncertainties are such that we didn't have that confidence or conviction to say, well, it's pretty clear which direction we're going or how we're thinking about the future, and we're really taking the view of, hey, we need to go meeting, assess the information, and make the decisions without that. So I think that that is totally healthy and inappropriate.
Derby:
Is the pullback in guidance not appropriate to current conditions where uncertainty is very high, or is the pullback and forward guidance appropriate for the longer run horizon?
You've said in recent speeches that now is not a good time for forward guidance because things are all over the place and we have to feel our way through this. We don't exactly know what's going to happen.
But there are other times where things are more placid, and you could conceivably say we think this is the path, and you still have your SEP forecasts, you're still putting out rate forecasts. I mean, presumably you will continue to do that, maybe you won't. But I'm just wondering about a general pullback from forward guidance as a concept given the whole post GFC world where forward guidance has been there through all of that. So is this a general retreat from providing forward guidance?
Williams:
Well, I can't speak to what we'll do in the future, but I do think that where we've used forward guidance in the past has been in situations where the committee felt that without the forward guidance, either market participants would not would not fully understand kind of where we are and where our intentions are, or we were in extraordinary circumstances like being at the zero lower bound.
Where forward guidance, really, I think, was serving the purpose of, we've not been at the zero lower bound in many generations. Let's help explain how we're thinking about that. So I think it's very conditional on, there are times such when we're the zero lower bound where some type of forward guidance-- there's lots of versions of that, there's kinds of qualitative, or there's more kind of directive or quantitative versions of that. But where that was seen as being helpful or support, helping the markets understand kind of how we're thinking about this unusual circumstance.
So I see that as being around this zero lower bound, as being a tool that was valuable. And of course there's always trade-offs in using policy tools and how to use them best, but potentially valuable. There were other periods. You go back to Chairman Greenspan in 2003 and four, and actually even a little earlier as well, where the committee under Chairman Greenspan used forward guidance because the understanding of the committee was that, it wasn't a zero lower bound, but the markets were kind of understanding the situation different than the committee was thinking about in terms of monetary policy. So that was a considerable period, of “measure pace” and that kind of language, of a softer version of forward guidance.
So again, I think that the tool has been brought out at periods of time where there seemed to be a disconnect between where the committee was thinking and approaching things and how the markets or the outside world was. So I think it's very conditional. But even in the period after that, 2003 and four, is interesting. With Chairman Bernanke taking over, there was kind of even then, before the financial crisis, a pullback from forward guidance because I think a similar situation to where we now, where it's not clear which direction policy should go, and then forward guidance is not helping us achieve our goals.
I think the end of the day, from my perspective, all of these questions about how do we communicate, how do we, is it useful to structure communications around thinking about the economy. It's always based, it should always be based on one question: How do we best achieve our goals? And so when I look back at the history, whether it's Chairman Greenspan or everyone since then, it depends on the situation. It depends on the problem you're trying to solve and where you are relative to your goal.
So right now, I don't see forward guidance as being helpful to achieving our goals in terms of the FOMC trying to give direction about where policy is going. But I don't see that as saying, well forward guidance is never useful because I've seen it in other periods be viewed by the committee, different committees under different chairs as being helpful in that situation.
Derby:
There seems to be more uncertainty about what the Fed would do going into the FOMC meeting than normal, and that could be attributed to circumstances. But I did hear a lot of talking about if the idea if Warsh isn't going to give a clear sense of where he's going with things, maybe FOMC meetings are just going to be much more uncertain affairs for market pricing. Do you think that's a valid view, is this something that markets should maybe get used to, that you go into FOMC meetings now with a less clear sense of what the outcome is going to be.
Williams:
Well, I think if you think about the situation we're currently in, I think there is uncertainty about how the economy is going to evolve and how the data are going to evolve. So I think that the idea that everybody would know exactly, act as if we all know what's going to happen in terms of the economy and therefore monetary policy, I think is inconsistent.
So I think that in a world where we're driven by our decisions, are driven by the commitment to achieve price stability, achieve our goals as best we can, I think that the idea that depending on how the data evolve and how the situation evolves, there's uncertainty about well, what's a policy decision that would be appropriate to achieve our goals would evolve, I think that that's normal.
So in a shorthand, I mean, I don't worry about there being, the market participants saying, well you know, they could go one way or the other, or there may be uncertainty about a particular decision. I think what's important is not about, do the markets come into a meeting thinking, well, I think the Fed's going to do this or that. But what I care about, that kind of uncertainty may just be normal, what I care about is that everybody understands our absolute very clear determination to achieve our 2% inflation goal. That we're obviously ready to make decisions in order to support the achievement of that. And we're committed on achieving our goals and doing our very best to accomplish that, and the fact that there would be uncertainty about well what are you going to do at the next meeting, I don't think that's a problem.
Derby:
Has there been any change in the Fed's commitment to achieving 2%, has it gotten stronger since Chair Warsh has returned, or has it been fairly consistent all the way along?
Williams:
I think that our commitment on the FOMC has been to achieving the 2% goal, has been consistently very strong. I think it's, it has, given that the context of the situation we're in, where inflation has been too high for too long, I think it is important that not only we, we've made very clear that this is absolutely fundamental to achieve that, achieve both of our of our goals. So I think it's important to emphasize that and to, then of course make sure that we actually achieve that. But my personal view is that that commitment has been, has been there.
Derby:
Do you think there was any sense in which financial markets were losing, or financial markets, the public in general were losing confidence the Fed was going to get inflation to 2%
Williams:
Well, it's very hard for me to answer the public's confidence in achieving something.
Derby
You've got the Survey of Consumer Expectations!
Williams:
Yeah, we have the SCE. Thank you. We have market measures of inflation compensation and inflation swaps. We have the surveys, like the survey of consumer expectations, surveys of economists, other surveys, and then we talk to people.
I talk to a lot of business people, community leaders, and market participants. I think that, I think people have their perspectives, their views. I think that we even see this in surveys, where when inflation got high, the surveys didn't really show, or the market measures didn't show, a big movement in longer run inflation expectations, but they did show some movement up a few years back in kind of near and medium term inflation expectations.
So we're watching this very carefully, and clearly there were some commentators who have expressed the view, I still remember this, when we were at 4% inflation, where people said you wouldn't get it back to two, and I said, yes, we will. And then when it got closer, between two and three back a couple years ago, I think that people said, kind of that view changed. So my view is it's hard for me to know. People have their views and perspectives and about this. I do think that, I go back to how I talked about financial markets, financial markets come to their own conclusions. Participants come to their own views about this.
But what matters for us is that we're just laser focused on achieving our maximum employment price stability goals. And importantly, part of that is getting inflation back to 2.0% on a sustained basis.
I will say on this, I really have not sensed a view that the credibility of the FOMC had in any way faltered or changed over time. Not only do we see that in inflation expectations, kind of longer term inflation expectations, I think that credibility is there, and it continues to be there. And so that that's not the issue that I see. I think that what you did see is when inflation was high, people kind of questioning, well, how long does it take for you to get inflation back down more than anything.
Derby:
So I know you're limited about what you can say but Chair Warsh says he wants to have a family fight at FOMC meetings. Has there been any substantive change in how you guys talk about monetary policy, and I know you're limited in what you can say about deliberations, but is the tenor of the debate changing inside meetings in any way you can address?
Williams:
I think we are having excellent meetings where people are all 19 participants are coming having thought carefully and thoroughly and deeply about all the issues that we're facing, all the great deal of uncertainty. So I think that this is a period of time where we're facing a lot of factors that are influencing the economy that also influence inflation and growth and the labor market. So people are bringing a lot of really good perspectives and differences of views, and bringing different kinds of research and analysis. It helps us think about that.
So I think that's a really healthy for us. I think that it fits in to have that very open and I would say open-minded debate and discussion around these issues, that we're trying to understand, including AI and all of that. So that's good. Of course, we also are all looking forward to the various task forces coming and bringing some outside perspectives to I think hopefully bring some new ideas, but also shape some of the debates and discussions around these big issues.
So I feel like that we're having those discussions, definitely creating that space to have I think a very healthy debate, and I cannot overstate how there's a big debate about how do we best think about things. There's a debate about how do we best achieve our goals, but there's absolutely no debate about the importance of achieving maximum employment and price stability. I mean, everybody is united and committed to that. We have to get this job done as best we can, we listen to each other, we learn from each other, and figure out as best we can the way forward. Knowing that every six to eight weeks we get back together, and we're going to do that again. So I think we're in a very, very healthy, good place on that.
Derby:
Various Fed reports have talked about elevated asset prices for an extended period of time, and that seems to come up again and again. I'm curious what you see in terms of bubble risks in the AI sector now that leverage is now starting to become part of it, and there is a lot of uncertainty about how this is all going to play out. And leverage is obviously where things, that starts to get into the mix and that's when stuff could happen. Do you see any notable risks in the AI investment, like a bubble type of situation?
Williams:
I don't. I don't see this as a bubble kind of situation. I guess maybe that word, maybe, is I think not the help very helpful here. But I think what we're seeing is a very high level of excitement, enthusiasm around new technology, around AI, and how that can increase productivity, how it can generate new products, new ways of doing things, and I think that's very real. And I'm definitely in the camp that thinks this is a general purpose technology that will be transformative, and it's going to take years and years of investment and lots of innovation and kind of new thinking around this to fully realize those benefits of new technologies.
I think from the financial market point of view, investors are trying in real time to solve a almost intractable problem, and that is how big are the benefits of AI going to prove to be. Who are going to be the companies that end up coming up with the best models, the most useful models, and how much are they going to be able to charge for those? There's so much activity going on with large language models, small language models, competition from various companies here and abroad. So I think that when I think about the question you're asking, is I think there is a lot of well-founded enthusiasm to be investing at large scale, and that this is going to be transformative for the U.S. economy.
But of course, whenever you have investors and people thinking about well, is it going to be this model that's going to work? Is it going to be this? Is who's going to come out ahead on this? There's risks.
Derby:
The introduction of leverage?
Williams:
So the leverage, I guess, this is not the kind of leverage you think about with the housing crisis, where it's like I think, at least so far, that you know where, it's that you're right now, a lot of it is really about debt financing along with equity financing. These are, most of these businesses have very high earnings, so I'm not as worried about the financial stability from the leverage right now. But I do think that you could have and likely to have at some point in markets, as well, we've seen it even in recent weeks. Kind of reassessing who, how big how big the effects of these going to be. Who's going to come out ahead? Who might be affected negatively? And I think that's a normal thing. So I that the idea that there's going to be some volatility in the equity markets as we see how this plays out, I think it just comes with a highly innovative fast-changing world there, and we've seen that in the past.
(Reporting by Michael S. Derby)
