“Fed Chair Sees ‘Long Way to Go’ on Inflation Fight” (NYT):
“Inflation has moderated somewhat since the middle of last year,” Mr. Powell said. “Nonetheless, inflation pressures continue to run high, and the process of getting inflation back down to 2 percent has a long way to go.”
“Inflation has consistently surprised us, and essentially all other forecasters, by being more persistent than expected,” Mr. Powell said. “And I think we’ve come to expect that — expect it to be more persistent.”
He added that there’s a “common factor” that has driven price increases higher. “It’s the pandemic, and it’s everything about the pandemic: The closing of the economy, the reopening of the economy, the fiscal support, the monetary support. All the things that happened went into high inflation.”
Of course, it is the virus that is to blame, not the human response (panic everywhere other than in Sweden) to the virus! But if the wild government spending on coronapanic is now the official cause of inflation, how can the Fed stop inflation? Congress continues to spend wildly with annual budget deficits that were, prior to 2008, seen mostly during wars. From the CBO:
Separately, here’s my latest inflation achievement… paying $30 for Pad Thai (Jackson, Wyoming):
That was one week after getting a haircut in a barber shop… for $55 plus tip (Big Sky, Montana).
Related:
“Economics is a highly sophisticated field of thought that is superb at explaining to policymakers precisely why the choices they made in the past were wrong. About the future, not so much.“
Ben Bernanke
If it spoken by Bernanke I am sure he meant to say it about financial accounting, not economics. Under his supervision financial accounting rules were changing to fit the outcome. He is no heretic, he would not purposefully dare to blaspheme economics as a whole, which we know is no changing since publication of Das Capital.
The difference between micro-economists and macro-economists is that micro-economists are wrong about specific things, while macro-economists are wrong about things in general.
Sweden had inflation rates ranging from 10-12% in the last couple of months!
Perhaps someone should inform Mx. Powell that certain other ongoing geopolitical issues might affect inflation.
In the UK, inflation is mostly Brexit’s fault. Central banks work diligently to contain inflation at all times, but gosh darn it, sometimes stuff happens that upsets all their best efforts! So it can’t be anything to do with them that the USD lost 96% of its purchasing power (as of 3 years ago, so more now) since they started managing it.
Did you see Liz Cheney at the Pad Thai restaurant?
Teton County voted for Bidet by a 9848-4341 margin. That’s Liz’s home! https://www.cnn.com/election/2020/results/state/wyoming
Teton County also has a 95% vax rate and was still urging mask usage during Summer 2022.
https://cowboystatedaily.com/2022/06/10/teton-county-urges-indoor-mask-use-while-glacier-national-park-reinstates-mask-mandate/
Steve: That is a wide margin! I had no idea that the folks in Teton County were so righteous. I don’t suppose that they use the term “Bidenflation.” I wonder why they don’t voluntarily pay income tax to the state so that great works can be accomplished (due to the prevalence of wrongthink, the state has no mandatory income tax).
Sounds like the jawboning strategy Yellen employed while not really raising rates. The government is in a battle against deflation & always will be, based on their accounting. They stopped quantitative tightening 3 months ago.
Go Docter fauci! Nobel winning virologist at the Wuhan Institute of Virology? Check. Created inflation? Check. Science.
Harvard has to bestow honorable doctorate on coronavirus because it has so many economic citations.