After abandoning its view that inflation would be "transitional," the Fed had to aggressively catch up to counter high and damaging price increases. However, the central bank lagged far behind and is now forced to raise interest rates sharply amid slowing local and global economies. Thus, the once-idea of a "soft landing" has been replaced by the growing possibility of the US economy being pushed into recession, with the resulting damage spreading far beyond the US.
why does inflation rate have to be 2%? is it a law in nature? no! inflation rate in those big countries in Latin America such as Brazil, Mexico, Columbia, Argentia, Chile, India, Russia, Indonesia has been around 4% for the last 25 years. Mr. Powell, it's new millennium, new normal, let's get it down to 4%, and learn to live with it.
There doesn't have to be any inflation. Period. It is simply a way for central banks to make infinite profits. Nobody sees this. Not even @piezoe
Fed reminds me of a firefighter who creates a fire in order to stay employed. After the fire engines have arrived at the blazing scene, the firefighter makes out he's doing at great service to the community, even joining in discussion meetings later on how to prevent fires.
I've been running a thread Australia’s property boom making the nation poorer which is up to page 51 atm, all about housing prices being out of control. Food prices began creeping up about a year ago, mainly as a result of labour shortages due to Covid and possibly to a part where farm workers, backpackers etc cant afford to pay the crazy Australian rents.
Certainly there are times when this would be an appropriate observation. What I was referring to in my comment regarding the article about Forbes was the reporters remark: "Forbes suggested using gold to stabilize currencies — for example, tying the U.S. dollar to gold so the dollar has a fixed value." This might just be Forbes being misinterpreted by the reporter. I hope so. No sane person would advocate going back to the gold standard, because it's impossible. And why would anyone want to go back to it unless they were truly insane? The gold standard wasn't a good idea when it was briefly fully implemented from 1957-71. Keynes warned in 1944 that it could not succeed, ad he was right! He also was responsible for convincing Roosevelt to get rid of it during the Great Depression, which he did by subterfuge against a protesting Central Bank. They hated Roosevelt for this. (The Central Bank was controlled by private banks in those days.) The gold standard hung like an albatross around the neck of the U.S. economy. Once rid of it, Roosevelt's new deal programs could begin to heal our broken economy. The gold standard will never return, and thank god for that!
Mick, do you think President Trump’s constant threats to Powell of Impeachment that if he did not go to 0% caused any of this mess? Powell caved in 2019 Paul Volcker endured the Reagan’s brutal attacks and stood his ground. Than again voters in the 1980s were more long suffering and less radicalized. Trump directly attacks Fed Chairman Powell, saying 'Obama had zero' interest rates https://www.cnbc.com/2018/10/10/trump-says-the-federal-reserve-has-gone-crazy.html “ Trump attacks Fed Chair Powell's 'horrendous lack of vision,' calls for huge rate cut "Democrats are trying to 'will' the Economy to be bad for purposes of the 2020 Election. Very Selfish!" President Trump tweeted. https://www.nbcnews.com/news/amp/ncna1043931
Yep, leading politicians have a huge influence on what the Fed might do. Political parties are voted in by consituents, therefore the Fed thinks that what politicians want is what the majority of people want. To run contrary to what the ruling party leader wants, is inviting disaster to your job and the Fed is like all employees, wants to save its ass. Unfortunately its called appeasment and we are but human, wanting to be liked even though we may disagree with our own decision. I'm sure for example, the Russian army as a whole do not like or agree with slaughtering civilians, nevertheless they go ahead and do it to appease those higher up the chain. But Trump is nearly clueless in everything, gawd knows how the American public were so easily conned to vote in a TV personality actor. Such is life.