Thursday, June 6, 2019

I Don’t Know But …

The Federal Reserve is charged with controlling inflation – the current target is at two percent – and fostering an environment of full employment.

Economists argue a lot about the latter, but the current rate of less than 4% unemployment is clearly full employment.

Unless you ask a couple of questions which no one asks, so we are at full employment.

donnie keeps throwing monkey wrenches into the gears of the smoothly running economy, most recently a trade war with China and an imminent trade war with Mexico.

Those  two trade wars seem to be bringing economic growth into question.

The stock market thinks that it heard Chairman Powell of the Fed say recently not to worry; if things begin to slow down he will lower rates to provide offsetting stimulus.

I have this question though.

The trade wars are fueled by tariffs; tariffs are ultimately found in the prices consumers pay; 25% added on to everything looks to me to be pretty inflationary; in fact it could probably be called historic in its magnitude.

So Chairman Powell is going to lower rates just as inflation spirals out of control?

I feel so lucky that we have donnie, that brilliant bidnessman.

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