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House of Roberts

(6,565 posts)

8. Raising interest rates only improves inflation

Reply to Johnny2X2X (Reply #6)

Wed Mar 2, 2022, 12:57 PM

Mar 2022

if the inflation is caused by broad prosperity of consumers. We don't have that. This is what the Fed screwed up in the 70s, which caused stagflation. In the 70s inflation was a result of external cost increases the same as it is now.

No economist has made a comparison between aggregate demand now and from before the pandemic, but unless aggregate demand is considerably higher now, there is no way raising interest rates will help.

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Powell just said at his testimony that he is inclined to raise interest rates at 25 basis points [View all] JohnSJ Mar 2022 OP

There Was No Way They We're Going To Do 1/2% SoCalDavidS Mar 2022 #1

A lot of analysts were pushing that idea, and so was Bullard JohnSJ Mar 2022 #3

They Were Also Pushing Idea Of 5-6 Hikes This Year SoCalDavidS Mar 2022 #5

Needs 50 Johnny2X2X Mar 2022 #2

Not at this stage with Ukraine and gas prices at all time highs JohnSJ Mar 2022 #4

Raising fights inflation. Johnny2X2X Mar 2022 #6

Raising interest rates only improves inflation House of Roberts Mar 2022 #8

Very market friendly... orwell Mar 2022 #7

No doubt JohnSJ Mar 2022 #9