{"id":63424,"date":"2022-09-01T06:44:52","date_gmt":"2022-09-01T11:44:52","guid":{"rendered":"https:\/\/olduvai.ca\/?p=63424"},"modified":"2022-09-01T06:45:09","modified_gmt":"2022-09-01T11:45:09","slug":"fed-paper-admits-the-central-bank-cant-control-inflation-finger-points-at-federal-government","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=63424","title":{"rendered":"Fed Paper Admits the Central Bank Can\u2019t Control Inflation; Finger-Points at Federal Government"},"content":{"rendered":"

Fed Paper Admits the Central Bank Can\u2019t Control Inflation; Finger-Points at Federal Government<\/a><\/h3>\n
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It appears somebody at the Federal Reserve has figured out that the central bank can\u2019t tame inflation, so it\u2019s setting up a scapegoat \u2013 Uncle Sam.<\/p>\n

A paper<\/a>\u00a0co-authored by Leonardo Melosi of the Federal Reserve Bank of Chicago and John Hopkins University economist Francesco Bianchi and published by the Kansas City Federal Reserve argues that central bank monetary policy alone can\u2019t control inflation.<\/span><\/p>\n

The paper\u2019s abstract asserts, \u201cThis increase in inflation could not have been averted by simply tightening monetary policy.\u201d<\/p>\n

In a nutshell, Melosi and Bianchi argue that the Fed can\u2019t control inflation alone. US government fiscal policy contributes to inflationary pressure and makes it impossible for the Fed to do its job.<\/p>\n

Trend inflation is fully controlled by the monetary authority only when public debt can be successfully stabilized by credible future fiscal plans. When the fiscal authority is not perceived as fully responsible for covering the existing fiscal imbalances, the private sector expects that inflation will rise to ensure sustainability of national debt. As a result, a large fiscal imbalance combined with a weakening fiscal credibility may lead trend inflation to drift away from the long-run target chosen by the monetary authority.\u201d<\/p><\/blockquote>\n

There are a couple of startling admissions in this single paragraph.<\/p>\n

First, the authors acknowledge that the federal government uses inflation as a tool to handle its debt. In other words, it acknowledges that we\u2019re all paying an inflation tax.<\/p>\n

Peter Schiff talked about this inflation tax<\/a>\u00a0in an interview on\u00a0Rob Schmitt Tonight.<\/em><\/p>\n

Inflation is a tax. It\u2019s the way government finances deficit spending. Government spends money. It doesn\u2019t collect enough taxes, so it has to run deficits. The Federal Reserve monetizes those deficits \u2013 prints money. They call it quantitative easing, but that\u2019s inflation…<\/p><\/blockquote>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

Fed Paper Admits the Central Bank Can\u2019t Control Inflation; Finger-Points at Federal Government It appears somebody at the Federal Reserve has figured out that the central bank can\u2019t tame inflation, so it\u2019s setting up a scapegoat \u2013 Uncle Sam. A paper\u00a0co-authored by Leonardo Melosi of the Federal Reserve Bank of Chicago and John Hopkins University […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[124,303,379,426,431,23123,534,538,13351,662,8625,18779,3650],"class_list":["post-63424","post","type-post","status-publish","format-standard","hentry","category-economics","tag-central-banks","tag-fed","tag-government","tag-inflation","tag-interest-rates","tag-michael-maharrey","tag-monetary-policy","tag-money-printing","tag-price-inflation","tag-quantitative-easing","tag-quantitative-tightening","tag-schiffgold","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63424","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=63424"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63424\/revisions"}],"predecessor-version":[{"id":63425,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63424\/revisions\/63425"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=63424"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=63424"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=63424"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}