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Also, what’s the end game? Current rates are not that bad relative to historical rates.
by fourside 2y ago
Also, what’s the end game? Current rates are not that bad relative to historical rates.
- jldugger 2y agoThe end game is the fed delivering on their sub 2% promise. Anything less would cede their credibility, which they will need in future crises.
- doctoboggan 2y agoI believe its no longer "sub" and now their mandate is just maintaining close to 2%
- jldugger 2y agoI know that the fed (Powell?) has been suggesting that 2% should be a long term average, but I took that largely to forgive their performance thus far. If they want credibility in the market long-term, they'll have to demonstrate they can return below 2% before lowering rates.
- baq 2y agoNot happening without a recession.
- bediger4000 2y agoWe heard that all through 2021-22 (or thereabouts) and it didn't happen. Why would it happen now?
- baq 2y agoExactly my point! :) ...but if it does happen, inflation will come down, too.
- mindslight 2y agoGoing right back to ZIRP will cede the Fed's credibility. Primary monetary creation needs to be done by the Treasury spending money for deliberate productive purposes, rather than given away as cheap undirected loans to banks so they can continue pumping up leveraged asset bubbles.
- jldugger 2y ago> Going right back to ZIRP Sub 2 percent inflation, not sub 2 percent real interest rates.
- WalterBright 2y agoThe fed doesn't cause inflation, nor can the fed cure it. They can only react to it.
- wakawaka28 2y agoThe way inflation is measured has radically changed over time. You can't realistically compare current numbers to those in the 70s. The same redefinition issue affects unemployment data. The only people I know trying to do apples-to-apples comparisons are the guys running https://www.shadowstats.com https://www.shadowstats.com