@receiptsnews: Bessent on his tariff warning: “my predictions have been bad” At the Senate Banking Committee's Feb. 5, 2026 hearing on the Financial Stability Oversight Council's annual report, Sen. Chris Van Hollen (D-Md.) asked Treasury Secretary Scott Bessent whether he used to believe tariffs would raise prices. Bessent said he wrote that in a letter to his investors, but that a year before he also wrote that he thought Sen. Elizabeth Warren would be the Democratic presidential nominee: "So my predictions have been bad." Van Hollen said the letter was from January 2024 and that Bessent had said tariffs would raise prices. Bessent replied that he said they could, that he also said they would strengthen the dollar, "and the opposite has happened," and that prices have not gone up, citing 150 years of data from the San Francisco Fed. He did not name the research; the San Francisco Fed paper that fits is Economic Letter 2026-01 (Regis Barnichon and Aayush Singh, Jan. 5, 2026), which found that U.S. tariff increases between 1869 and 1941 were followed by higher unemployment and lower inflation, and cautioned that those historical experiences may not fully apply to current conditions. Van Hollen answered that the National Association of Home Builders had reported construction costs at a record share of a new home's price. The record: Bessent's January 2024 letter to investors said, "Tariffs are inflationary and would strengthen the dollar," as quoted by Fortune and read into the House record by Rep. Sean Casten on Feb. 4. At a House hearing that day Bessent said, "If I was mistaken, I want to correct it. And I was also mistaken when I said the tariffs could be inflationary" (Reuters). Earlier in the Senate hearing he had said building costs were "now down in the year"; the home builders' survey Van Hollen cited covers 2024 (construction was 64.4% of a new home's price, a record since the series began in 1998, published Jan. 29, 2025), so it does not settle whether costs fell in 2025. Sources: Senate Banking Committee hearing video, Feb. 5, 2026; Fortune, Feb. 4, 2026; Reuters, Feb. Source: Senate Banking Committee, Feb. 5, 2026 #Bessent #Tariffs #SenateBanking #Receipts

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Sunday 25 October 2026 00:29:38 GMT