Home PoliticsAmerica Fed Chairman Powell Did Not Say…

Fed Chairman Powell Did Not Say…

by Paul Ebeling

#Fed #Powell #taper #GDP #economy #growth #labor #inflation #energy #Trump #Biden #leadership #interest,

“…the Fed will begin raising rates on some date certain in 2022”— Paul Ebeling.

Hang on!

The US unemployment rate fell to 4.2%, the lowest mark since before the VirusCasedemic. Also, labor force participation improved, which means more people are rejoining the labor force after taking to the sidelines during the chaos.

These latest economic developments are contradictory and dissonant. Some data suggest strength, other data, weakness.

For The People, uncertainty over higher prices, job opportunities and interest rates will probably linger at least until next Spring.
Mr. Powell did not say the Fed will begin raising rates on some date certain in Y 2022. What he did say was the Fed now thinks elevated inflation could force the Fed to act sooner than it expected a few months ago.

But maybe not!

A sustained drop in energy prices would bring inflation down a bit maybe and the Omicron variant could slow GDP growth. Less output means less spending and a bit less demand, also anti-inflationary. A few months from now, Mr. Powell might very well say, never mind, we are not that worried about inflation after all.

Markets and consumers dislike this kind of uncertainty.

The economy is steadily improving, yet confidence has been plunging since the Summer, largely due to disruptions caused by the Delta variant, after many Americans thought COVID would be in the rear-view mirror.

Now, the Omicron variant and new restrictions on travel and commerce will probably push consumer confidence lower heading into the Christmas holidays.

Mr. Biden would prefer a simpler, more upbeat story. But, for now he has to acknowledge concerns about inflation, Omicron, and labor-market stress, while also talking up improvements in the economy during his term. His creditability is already shot, what with his job approval rate is down to 36%

President Trump (45) says Mr. Biden is a “1-trick pony” whose administration just wants to push COVID-19 vaccines on Americans, a major reason the US did not meet “moderate” jobs expectations set by economists.

“America fell 340,000 jobs short of the very modest expectations set by economists. That’s because Joe Biden is a 1-trick pony, ‘Get the vaccine,'” President Trump said in a statement released by his Save America PAC.

But no one trusts this administration. I developed the vaccine when everyone said it wasn’t possible, now without ‘Trump,’ that’s their only solution. This administration is destroying America before our very eyes because there is no leadership.”

We are sure when the economy will start to feel normal again, or if the fearmongering about the disease will ever end.

What sure is more strange stuff is coming, as Fed will stick to untested new policy tools while inflation transforms the American economy.

Have a healthy, happy weekend, Keep the Faith!

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