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I don't really think Powell has the political will to imitate Volcker. The election is close and I see no way Biden's government will accept an economical colla

I don't really think Powell has the political will to imitate Volcker. The election is close and I see no way Biden's government will accept an economical collapse at the end of the second term. The political resistance will be paramount, and from both sides. Maybe, just maybe, the outcome is to raise to medium-high, and then cut back to medium but stay there for long term. There will be a recession at the end of rate hiking, but once Russia and China capitulate the economy will boom again and the Federal Reserve then stand a much better position figuring things out.

nverno 4y ago
> The election is close and I see no way Biden's government will accept an economical collapse From what I've read, it was very damaging to Jimmy Carter's reelection, so you're probably right about this.
- reducesuffering 4y ago
  It was, Jimmy knew this, and he still appointed Volcker to do what he had to do to protect the US economy in the long term. Contrast that to our last President that was screaming in caps on Twitter demanding that the Fed cut rates to 0%. https://twitter.com/realDonaldTrump/status/1171735691769929728 https://twitter.com/realDonaldTrump/status/11717356917699297... I don't know how one could be unashamed currently being a part of that party.
  - nverno 4y ago
    > Jimmy knew this, and he still appointed Volcker to do what he had to do to protect the US economy in the long term Right, this is probably pretty rare amongst politicians- the willingness to sacrifice their career for the greater good (or what they believe is for the greater good).
  - roflyear 4y ago
    - jaybrendansmith 4y ago
      I welcome their hatred. Wrong is wrong.
  - tootie 4y ago
    He was even advocating negative rates. And making direct threats to the Fed chair too. That's the playbook Erdogan has used to keep Turkiye's inflation at a healthy 85%.
lamontcg 4y ago
> I see no way Biden's government will accept an economical collapse at the end of the second term. The Fed doesn't take orders from the President though (and prides itself on that) and most Presidents are very reluctant to be seen as giving orders to the Fed. It is likely that Biden will leave the Fed alone up until an economic collapse appears, at which point it will be too late and the Fed will already be planning on cutting rates.
- nverno 4y ago
  Biden would be in a position to replace Powell in a couple years, though, should he be reelected.
  - lamontcg 4y ago
    And Biden would be crucified in the business pages if he were seen to be playing politics with the Fed that blatantly.
    - illiac786 4y ago
      We're lucky he cares about that. Being unashamed is the new fashion since Trump (or before that even) and the next president may care very little about the business pages...
- kodyo 4y ago
  > The Fed doesn't take orders from the President though (and prides itself on that) Acting as the currency manipulator for a purported Republic, being unaccountable to the electorate is one of its most repulsive features.
dragonwriter 4y ago
> I see no way Biden's government will accept an economical collapse at the end of the second term. The President has little influence on the Fed, by design, and can’t do much fiscal stimulus without Congress, so no matter what Biden’s government wants, its not their choice.

nverno 4y ago

> The election is close and I see no way Biden's government will accept an economical collapse From what I've read, it was very damaging to Jimmy Carter's reelection, so you're probably right about this.

reducesuffering 4y ago
It was, Jimmy knew this, and he still appointed Volcker to do what he had to do to protect the US economy in the long term. Contrast that to our last President that was screaming in caps on Twitter demanding that the Fed cut rates to 0%. https://twitter.com/realDonaldTrump/status/1171735691769929728 https://twitter.com/realDonaldTrump/status/11717356917699297... I don't know how one could be unashamed currently being a part of that party.
- nverno 4y ago
  > Jimmy knew this, and he still appointed Volcker to do what he had to do to protect the US economy in the long term Right, this is probably pretty rare amongst politicians- the willingness to sacrifice their career for the greater good (or what they believe is for the greater good).
- roflyear 4y ago
  - jaybrendansmith 4y ago
    I welcome their hatred. Wrong is wrong.
- tootie 4y ago
  He was even advocating negative rates. And making direct threats to the Fed chair too. That's the playbook Erdogan has used to keep Turkiye's inflation at a healthy 85%.

lamontcg 4y ago

> I see no way Biden's government will accept an economical collapse at the end of the second term. The Fed doesn't take orders from the President though (and prides itself on that) and most Presidents are very reluctant to be seen as giving orders to the Fed. It is likely that Biden will leave the Fed alone up until an economic collapse appears, at which point it will be too late and the Fed will already be planning on cutting rates.

nverno 4y ago
Biden would be in a position to replace Powell in a couple years, though, should he be reelected.
- lamontcg 4y ago
  And Biden would be crucified in the business pages if he were seen to be playing politics with the Fed that blatantly.
  - illiac786 4y ago
    We're lucky he cares about that. Being unashamed is the new fashion since Trump (or before that even) and the next president may care very little about the business pages...
kodyo 4y ago
> The Fed doesn't take orders from the President though (and prides itself on that) Acting as the currency manipulator for a purported Republic, being unaccountable to the electorate is one of its most repulsive features.

dragonwriter 4y ago

> I see no way Biden's government will accept an economical collapse at the end of the second term. The President has little influence on the Fed, by design, and can’t do much fiscal stimulus without Congress, so no matter what Biden’s government wants, its not their choice.