Rock and a Hard Place — Can’t imagine what’s running through JPow’s head when it hits the pillow these days.
Inflation is a 4-alarm fire. Groceries and other essentials are eating further and further into household budgets, which will dent discretionary consumption that the rest of the economy depends on.
At the same time, the economy is undoubtedly slowing. Tech layoffs have become a contagion, and warnings from the likes of FedEx point to languishing demand going into the all-important holiday season.
Job openings continue to outnumber the amount of available working people, which gives JPow fodder for continuing to tighten the screws. Technically, he’s only responsible for price stability and maximum employment, so his bases are covered.
Stock prices and profits plummeting? Not his problem.
It’s kinda like when a deer jumps in front of you on the highway. You don’t want to hit the deer, but slamming on the brakes and swerving could be much worse.
It feels like a good metric for determining the best path forward is looking at what will cause the least amount of pain for the average household on Main Street. Inflation blows, but if the cost of bringing grocery bills down is a breadwinner getting laid off—not sure that’s the best course of action.
A goldilocks scenario of lowered inflation along with steady growth increasingly seems like a fantasy. That’s just how this sh*t works; purposely slowing an economy causes pain.
How much pain and how fast it’s administered is the big question. If we get a full point rate increase at one of these upcoming meetings, look out below.
|
Beatae officia dolor quia mollitia doloremque quisquam omnis. Et delectus aut corporis dolor veritatis fugiat et.
Harum odio sed perspiciatis sint repellat. Aut qui iusto consequatur consequatur amet. Laborum repellat et sunt sit quasi.
Enim dolor sint et. Magni neque numquam officiis eum asperiores laudantium et. Quae eum est quia molestiae. Voluptatem ut pariatur quae aliquid.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...