The Fed was quite "bold" in the last months of 2021. Now it has to "carefully unbold" itself. In 2008, the "inflation fear" led BB to make major monetary policy mistakes. JP has, so far, avoided them. Actually JP did quite the opposite. This post indicates what a "soft landing" will look like. (if he disregards AIT).
Interesting article. I have two comments. First, the Fed can always change their mind given circumstances. If they see things slowing to quickly, they can simply not raise rates further. And second, the Fed is in a shotgun marriage with the stock market. If the market tanks, they will change direction. We don’t have a free market economy - it is a Fed market economy!
The Fed was quite "bold" in the last months of 2021. Now it has to "carefully unbold" itself. In 2008, the "inflation fear" led BB to make major monetary policy mistakes. JP has, so far, avoided them. Actually JP did quite the opposite. This post indicates what a "soft landing" will look like. (if he disregards AIT).
https://marcusnunes.substack.com/p/an-inflation-chart-book
Interesting article. I have two comments. First, the Fed can always change their mind given circumstances. If they see things slowing to quickly, they can simply not raise rates further. And second, the Fed is in a shotgun marriage with the stock market. If the market tanks, they will change direction. We don’t have a free market economy - it is a Fed market economy!