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We are already seeing inflation in the US. The Fed has chosen not to measure it - in their parlance they will "look through inflation".
by RachelF 5y ago
We are already seeing inflation in the US. The Fed has chosen not to measure it - in their parlance they will "look through inflation".
- jgalt212 5y agotrue that, they don't want to admit they overcooked it. And they don't want to take money off the table for fear of drawing the ire of the investor class. The Fed's balance sheet is double what it was a year ago, and quadruple was it was after the first round of liquidity during the GFC. https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm https://www.federalreserve.gov/monetarypolicy/bst_recenttren...
- astrange 5y agoWe are not seeing unhealthy amounts of core inflation. Relative price increases are not inflation because they’re relative. Real interest rates are still negative. The intent is to get inflation to the average target of 2%, so it’s of course good if we see some.
- imtringued 5y agoHopefully the temporary inflation spike will cause consumer and business confidence to rise and this leads to a long term 2% inflation rate which eventually rises beyond 2% once we hit full employment. If it were possible to instantly hit inflation targets we wouldn't need trillions of QE, debt via low interest rates or a doubling of the money supply, none of that is a goal unto itself. This why I prefer sending stimulus to those who would spend it immediately, the more effective the stimulus the less stimulus you need and the smaller the unintended side effects. Once interest rates and inflation rates have normalized, the economy will fix itself without further input.
- imtringued 5y agoInflation is going up according to official numbers, which kind of goes against your point. A bull market is not inflation by the way.