Episode
Midterm Elections, Affordability and the Fed
- Podcast
- Thoughts on the Market
- Published
- Apr 29, 2026
- Duration seconds
- 684
- Processing state
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Summary
Still six months out, the U.S. midterm elections are likely to influence government initiatives to deal with higher energy costs. Our Head of Public Policy Research Ariana Salvatore and Global Chief Economist Seth Carpenter discuss how the Congress and the Fed might react. Read more insights from Morgan Stanley. ----- Transcript ----- Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of Public Policy Research for Morgan Stanley. Seth Carpenter: And I'm Seth Carpenter, the firm's Global Chief Economist and Head of Macro Research. Ariana Salvatore: Today we're discussing the run up to the midterm elections and what it could mean for the macro outlook and policy response. It's Wednesday, April 29th at 10am in New York. Last week, Mike Zezas and I talked through the midterm elections and their potential consequences for the economy and markets. This week we figured it might be helpful to talk about the setup into November, especially as we're both increasingly being asked about the macro outlook and potential for targeted stimulus to offset the oil shock. So, Seth, let's start there. we know cost of living is a key issue in elections, and we've seen a pretty meaningful oil shock feed through markets. How are you thinking about that in the context of the broader economy? Seth Carpenter: Our U.S. economics team has estimated that the higher gas prices that we have now and likely to have for the rest of the year are going to be more than enough to offset any boost to consumer spending from the higher tax refunds this year. So, I think that's the first point. If you're expecting a boost to come through that channel, you probably want to unwind that. And In fact, overall, what we've done is lowered our fore…