Fed's 10-2 Split Under New Chair Warsh Overshadows a Big Tech Earnings Divide

On October 28, 2026, the Federal Reserve held its benchmark interest rate steady in the first policy meeting chaired by Kevin Warsh, and the vote split 10-2 — the widest dissent on a rate decision in recent memory. A 10-2 vote matters because it signals how divided the committee now is over whether to keep cutting, hold, or start raising again; traders read the size of the split as evidence the hawkish wing of the committee carries real weight under the new chair, and gold, which pays no interest and normally benefits when policy looks set to loosen, sold off on the news rather than rallying. The hold came alongside a report that the US economy grew 3.4% in the latest quarter, giving the dissenters cover to argue growth does not yet need more support. The clearest price-mover of the day was the split verdict on Big Tech's AI spending. Microsoft's fiscal first-quarter 2027 results showed cloud revenue growth accelerating to 19%, beating estimates, and the stock rose because that number answered the market's main worry: that billions spent building AI data-center capacity were not yet showing up as revenue. Alphabet reported the same day, and its results were weak enough that coverage flagged the stock for its worst one-day drop in years; because Alphabet is one of the largest companies in major indexes, its fall dragged broader US stock futures lower even as Microsoft's gain pulled the other way. The same AI-spending thesis produced opposite verdicts depending on which company's numbers you read. Away from the Fed, the rate picture kept diverging. The European Central Bank signaled it would raise rates once more in December and then stop, breaking from the Fed's steady hold, while New Zealand's central bank governor separately said the odds of a December hike there are "high." That divergence matters beyond the headlines: it changes currency and bond pricing for any portfolio holding assets outside the dollar, a live issue for a diversified book like the Buy List 2026 model portfolio, built across euro, krone, yen and dollar assets. Earnings season kept producing same-day winners and losers that had nothing to do with each other mechanically. Shell posted its best quarter since 2022 on the same day Haleon, the GSK-spun-off consumer-health company, sank 14.7%, a coincidence of reporting calendars rather than a shared cause. More structurally linked: mortgage rates sitting above 7% kept squeezing housing from both ends of the supply chain, rewarding one landlord with record occupancy on the same day another absorbed an $800 million loss — a split that tracks how 7%-plus financing costs favor operators without near-term refinancing needs and punish those without pricing power. Unresolved heading into the next session: what exactly Warsh's two dissenters wanted and whether a 10-2 split becomes the Fed's new normal; whether Alphabet's drop points to a broader AI-spending problem that Microsoft's 19% cloud number simply hasn't caught up to yet; and whether the ECB actually delivers the December hike it signaled. The December FOMC and ECB meetings, plus the next round of hyperscaler earnings, are what will settle each question. The Buy List 2026 portfolio's own numbers showed the day's currency and rate divergence in miniature. The €120,000 book closed worth €125,485, a total return of +4.57% against +3.89% on price alone, with the gap coming from income and currency effects across its multi-currency holdings. Vonovia, the German residential landlord caught in the same mortgage-rate squeeze described above, remained the portfolio's deepest laggard across its two tracked tranches, down 33.60% and 8.03%; Maersk, with shipping and energy-linked exposure, was the best price performer at +35.91%. MicroStrategy, the portfolio's bitcoin-linked holding, sat up 50.67% even as the portfolio's direct bitcoin position, BTC-EUR, was down 5.93% — a split in sentiment toward hard assets that echoed gold's reaction to the Fed's vote earlier in the session.