{"id":6993,"date":"2022-01-11T12:59:42","date_gmt":"2022-01-11T12:59:42","guid":{"rendered":"http:\/\/lonecandle.com\/?p=6993"},"modified":"2022-01-11T12:59:42","modified_gmt":"2022-01-11T12:59:42","slug":"feds-powell-pumped-trillions-into-the-economy-now-he-may-be-the-party-killer","status":"publish","type":"post","link":"https:\/\/lonecandle.com\/?p=6993","title":{"rendered":"Fed\u2019s Powell pumped trillions into the economy. Now, he may be the party killer."},"content":{"rendered":"\n<p>\n\n&#8220;The Fed has penciled in three rate hikes this year, and the first could come as soon as March.&#8221;<br>&#8230;<br>&#8220;Adam Ozimek, chief economist at freelancing platform Upwork, said the Fed misjudged how large the inflation spike would be, though he still thinks \u2014 as the Fed previously argued \u2014 that price increases will eventually start to cool on their own. He said the danger instead is that the Fed will overreact to levels of inflation that ultimately prove temporary, hurting the millions who still haven\u2019t returned to the labor force.<\/p>\n\n\n\n<p>\u201cInflation is by any measure extremely high, yet labor slack remains significant as well and we are far from full employment,\u201d he said. \u201cThe policy challenge is far more complicated than in 2018, when Powell faced uncertainty about labor slack but without the added pressure of high inflation.\u201d<\/p>\n\n\n\n<p>Still, others have praised the Fed\u2019s restraint amid the price spikes, keeping rates low and allowing the job market to heal more quickly. They argue that inflation is significantly being fed by supply chain issues that the central bank isn\u2019t equipped to solve.<\/p>\n\n\n\n<p>Former Fed Chair William McChesney Martin once said the central bank\u2019s job was \u201cto take away the punch bowl just as the party gets going.\u201d But Sahm argued that a few rate increases don\u2019t have to ruin anything.<\/p>\n\n\n\n<p>\u201cThings are getting better,\u201d she said. \u201cWe need to pour a little less punch in the punch bowl.\u201d&#8221;<br><a href=\"https:\/\/www.politico.com\/news\/2022\/01\/10\/fed-chief-powell-economy-challenge-526783\" target=\"_blank\" rel=\"noreferrer noopener\">https:\/\/www.politico.com\/news\/2022\/01\/10\/fed-chief-powell-economy-challenge-526783<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;The Fed has penciled in three rate hikes this year, and the first could come as soon as March.&#8221;<\/p>\n<p>&#8230;<\/p>\n<p>&#8220;Adam Ozimek, chief economist at freelancing platform Upwork, said the Fed misjudged how large the inflation spike would be, though he still thinks \u2014 as the Fed previously argued \u2014 that price increases will eventually start to cool on their own. He said the danger instead is that the Fed will overreact to levels of inflation that ultimately prove temporary, hurting the millions who still haven\u2019t returned to the labor force.<br \/>\n\u201cInflation is by any measure extremely high, yet labor slack remains significant as well and we are far from full employment,\u201d he said. \u201cThe policy challenge is far more complicated than in 2018, when Powell faced uncertainty about labor slack but without the added pressure of high inflation.\u201d<\/p>\n<p>Still, others have praised the Fed\u2019s restraint amid the price spikes, keeping rates low and allowing the job market to heal more quickly. They argue that inflation is significantly being fed by supply chain issues that the central bank isn\u2019t equipped to solve.<\/p>\n<p>Former Fed Chair William McChesney Martin once said the central bank\u2019s job was \u201cto take away the punch bowl just as the party gets going.\u201d But Sahm argued that a few rate increases don\u2019t have to ruin anything.<\/p>\n<p>\u201cThings are getting better,\u201d she said. \u201cWe need to pour a little less punch in the punch bowl.\u201d&#8221;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[13],"tags":[217,165,1316,682,586,587,635],"class_list":["post-6993","post","type-post","status-publish","format-standard","hentry","category-article-share","tag-economics","tag-economy","tag-inflation","tag-interest","tag-the-fed","tag-the-federal-reserve","tag-unemployment"],"_links":{"self":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts\/6993","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6993"}],"version-history":[{"count":1,"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts\/6993\/revisions"}],"predecessor-version":[{"id":6994,"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts\/6993\/revisions\/6994"}],"wp:attachment":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6993"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6993"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6993"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}