A Loaded Week: Fed, Nvidia, and Iran All Land at Once

There are THREE items of systemic import for the markets this week.

They are:

1. The Warsh Fed’s first Jackson Hole symposium (Thursday through Saturday).

2. Nvidia’s (NVDA) 2Q results (Wednesday).

3. The U.S./Iran conflict.

Let’s dive in.

First and foremost, the Fed is hosting its annual soiree in Jackson Hole, Wyoming. This is one of the most closely watched events on the macro calendar because it brings together central bankers, finance ministers, academics, and economists from around the world to discuss the global economy/financial system.

The critical item for investors will be new Fed Chair Kevin Warsh’s speech at 10AM EST Friday, August 28th.

Historically, Fed Chairs use Jackson Hole to hint at/unveil new policy approaches. Ben Bernanke used his 2010 speech at Jackson Hole to hint at QE2. Jerome Powell used past appearances to signal both tightening and easing pivots.

In this context alone, Kevin Warsh’s speech will be a major event. However, when you throw in the fact that Warsh has stated that he intends to completely change the Fed’s approaches to data measurement, strategy and communication, this Jackson Hole speech is of extreme importance.

As I outlined in our weekly market update from June 18th 2026, Warsh is in the process of revolutionizing the Fed. I could easily write an entire book on this, but since we have limited space, I’ll try to outline the proposed changes in broad strokes.

Over the last 30 years, Fed policy has followed three primary trends:

1. Using garbage data to “goal seek” policy.

2. Ever increasing communication/fame-seeking by Fed officials.

3. Focusing on stock prices as opposed to macro conditions.

Regarding #1, most of the politically relevant economic data (jobs, inflation, GDP) in the U.S. borders on complete fiction. Some glaring issues…

Jobs: the Bureau of Labor Statistics (BLS) jobs data is so inaccurate that each month’s number is usually revised three times. Even after those three revisions, the data remains so poor that once a year, the BLS must do a major revision for the prior 12 months. In 2024, this annual revision erased 598,000 jobs. In 2025, it erased 862,000 jobs. These revisions erased over a quarter and 70% of the jobs that were created in those respective years.

Inflation: The largest data set in the Consumer Price Index (CPI) is Shelter, accounting for 33% of the measure’s weight. The single largest component in Shelter is Owners’ Equivalent Rent (OER), which consists of the BLS asking homeowners what they think their home would rent for, rather than using actual sale prices or mortgage payments.

Aside from this, much of the data is outright fraudulent. Case in point, according to the BLS, healthcare costs are up only 2% in the last year. Bear in mind, health insurance premiums alone are up a median of 10% over the same time period.

GDP: GDP, which is compiled by the Bureau of Economic Analysis (BEA), is measured based on the garbage inflation data. This alone renders it inaccurate. After all, if GDP is up 4%, but inflation is up 4% as well, real GDP growth is ZERO. And we’ve already assessed how bad the inflation data is.

This brings us to the second item in our three-point list of Fed priorities over the last 30 years: ever increasing communication/fame-seeking by Fed officials.

As I outlined in our weekly market update from June 18th 2026, starting in the mid-1990s, the Fed’s culture shifted dramatically from one of secrecy to fame-seeking. The timeline was as follows:

· In 1993, the Fed began revealing the “minutes” from past meetings. For the first time in history, the Fed revealed what was being discussed behind closed doors (albeit at a five-year lag).

· In 1994, the Fed began providing real-time public statements when it made policy changes. Prior to this, the Fed simply acted and the world had to deduce what was going on via activity at the NY Fed’s trading desk. No more. From this point onward the Fed told the world what it was doing in terms of policy changes.

· In 1999, the Fed began making public statements even when it didn’t make any policy changes. Fed officials, particularly Alan Greenspan, were now celebrities.

· In 2003, the Fed began issuing forward guidance via its “dot plots” (a graphic depicting where Fed officials believed GDP growth, inflation, unemployment and other economic data points would be in the future). Apparently Fed officials were so important that the world needed to know what each one of them was thinking about individual economic data points!

· From 2003 until 2026, public appearances by Fed officials skyrocketed. A Brookings analysis tracking speech counts under Greenspan, Bernanke, and Yellen shows Bernanke oversaw a significant expansion of speeches from regional Fed presidents that continued under Yellen, and that count doesn’t even include media interviews and appearances. Even non-voting regional Fed Presidents were racking up double-digit speech counts per year right alongside the voters.

· By 2026, the number of public appearances by the 19 most senior Fed officials (7 governors plus 12 regional presidents), was well into the triple digits. On some weeks there would be as many as FIVE speeches/interviews!

Which brings us to our final point in the Fed’s three primary trends over the last 30 years: the Fed has increasingly focused on stock prices as opposed to macro conditions.

According to a study by researchers at the National Bureau of Economic Research, or NBER, starting in 1994, the Fed became increasingly sensitive to stock prices: a 10% stock market decline resulted in a roughly 32 basis point cut in the fed funds rate at the next FOMC meeting.

That same study also found that Fed officials began explicitly discussing stock market effects on the economy. Between 1994 and 2016, Fed officials mentioned the stock market 257 times. Out of those 257 mentions, 213 focused on the “wealth effect,” or the idea that rising stock prices make people feel richer and spend more.

To be clear, this is well outside the Fed’s Dual Mandate (seeking maximum employment with controlled inflation). But if you make Fed officials feel like rock stars with endless media fawning, thereby giving them the ability to move the stock market with their words… don’t be surprised if they start using that power more and more!

Enter new Fed Chair Kevin Warsh.

It is clear Mr. Warsh is disgusted with how the Fed has handled its affairs over the last 30 years. And he is proposing a complete overhaul of how the Fed measures data, what Fed policy focuses on, and how Fed policy is communicated. His strategy to change these items is as follows:

Framework review: Warsh has assembled 15 outside experts to formally evaluate the Fed’s monetary policy framework, with recommendations due by the end of 2026. The target is Average Inflation Targeting, the 2020 Powell-era policy that let inflation run above 2% to offset prior undershoots. Warsh has openly criticized AIT as something that entrenched damaging inflation expectations, and with inflation stuck above target for five years running, he’s positioning to scrap or rework it.

Policy changes: Historically, the Fed has relied on two items (rates and the Fed’s balance sheet) to control monetary policy. Usually, these policies have worked in tandem (cutting rates while growing the balance sheet or raising rates while shrinking the balance sheet).

Warsh has indicated that he believes the balance sheet is the more powerful tool when it comes to easing/restricting monetary policy. In simple terms, he believes that draining/pumping liquidity into the financial system has a larger impact than raising or lowering interest rates.

This marks a MAJOR shift from how Bernanke, Yellen and Powell steered the Fed. And it signals that Warsh is a much more sophisticated operator when it comes to financial system dynamics (there is ample evidence that liquidity, not rates, is the driving factor for asset prices/financial system stability).

Communication: Warsh’s first Fed meeting (June 2026) saw the Fed remove most of the language in its statement, reducing its word count from 349 to 140. Warsh also indicated that he is getting rid of the Fed’s “forward guidance,” which has been a primary tool for manipulating the markets.

Warsh has also floated the idea of reducing the number of Fed meetings per year from eight to four. And judging from the drop in Fed official public appearances (BoA noted that in the two weeks following the June 2026 FOMC meeting, there were only 12 Fed public appearances, versus an average of about 23 over the same window after meetings since 2022), it looks as though Warsh has also told Fed officials to stop rushing to the camera every chance they get.

In short, as I noted in our weekly market update from June 18th 2026, Warsh is in the process of revolutionizing the Fed. In this context, the Jackson Hole meeting this week from Thursday August 27th to Saturday August 29th will be a MAJOR focal point for the markets. Warsh’s speech, scheduled for Friday at 10AM EST, will be of particular focus as the entire financial world attempts to glean greater insights on his thinking.

Put simply, the Fed’s Jackson Hole meeting alone means this week will be a MAJOR one for the financial system. But that’s not the only item of note for this week.

Nvidia (NVDA), which is currently the largest company in the world, reports fiscal Q2 results Wednesday August 26th after the close. Given NVDA’s significance to the AI revolution (its Graphics Processing Units or GPUs are one of the primary items being used in the AI infrastructure buildout), the company’s results will be of systemic import.

Management has guided:

· Revenue: ~$91.0 billion, plus or minus 2%

· Gross margin: 74.9% GAAP, 75.0% non-GAAP, plus or minus 50 basis points

· Operating expenses: roughly $8.5 billion GAAP, $8.3 billion non-GAAP

To be clear, a clean beat on revenues, gross margins, and operating expenses won’t be enough for the stock to rally. NVDA has beaten estimates for four straight quarters, and the stock still dropped each time, because at this valuation the market wants a beat as well as a raised outlook and proof that the growth story will continue.

Remember, the four largest hyperscalers (MSFT, AMZN, GOOGL, and META), which combine with NVDA for over 20% of the S&P 500’s weight, are set to spend roughly $700 billion combined on capex this year, most of it aimed at AI infrastructure. Nearly all of that spending runs through Nvidia first. So, depending on what NVDA reports or doesn’t report, the entire market will react.