{"id":64458,"date":"2022-12-14T12:34:50","date_gmt":"2022-12-14T17:34:50","guid":{"rendered":"https:\/\/olduvai.ca\/?p=64458"},"modified":"2022-12-14T12:34:50","modified_gmt":"2022-12-14T17:34:50","slug":"no-surprise-wall-street-wants-to-raise-the-target-inflation-rate-above-2-percent","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=64458","title":{"rendered":"No Surprise: Wall Street Wants to Raise the Target Inflation Rate above 2 Percent"},"content":{"rendered":"

No Surprise: Wall Street Wants to Raise the Target Inflation Rate above 2 Percent<\/a><\/h3>\n

\"franklin\"<\/h2>\n
\n

Price inflation in the United States remains stubbornly high, with October’s print at 7.7 percent. The Fed’s preferred measure, so-called core inflation is only two-tenths of a percent below 40-year highs, at 6.3 percent. Yet, it was just last year that the Federal reserve and other “experts” were concerned that inflation wasn’t high\u00a0enough<\/em>. In January 2021, for example, Jerome Powell\u00a0stated that the Fed wanted price inflation to run above the “2-percent goal” because it had run below 2 percent\u00a0for too long<\/em><\/a>. The 2-percent inflation target, of course, is the arbitrary target picked by the Federal Reserve (and many other central banks) as the “correct” inflation rate.<\/p>\n

Now with inflation running near 40-year highs, many are wondering what will be necessary to bring price inflation back down to the target level. More specifically, how many hikes in the target interest rate will be necessary, and how severe of a recession will be required? Wall Street is especially interested in the answer to this question because Wall Street is no longer about fundamentals. Rather,\u00a0the “market” depends overwhelmingly on how much easy money the central bank pumps out. Naturally, the banker class wants a return to “normal”\u2014i.e., quantitative easing and ultralow interest rates\u2014as soon as possible. Moreover, Washington wants the same thing since the political class wants low interest rates to help ease the path to ever more government debt and higher deficits.<\/p>\n

It’s not the least bit surprising\u00a0that we’re already hearing calls for the Federal Reserve to\u00a0abandon the 2-percent inflation target and instead embrace even\u00a0higher<\/em>\u00a0perpetual inflation rates<\/a>. For example, last week Bank of America economist\u00a0Ethan Harris suggested<\/a>\u00a0that the 2-percent target CPI inflation rate be raised. We’ve seen similar urgings from both the\u00a0Wall Street Journal<\/em>\u00a0and from think tank economists in recent months.<\/p>\n

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

No Surprise: Wall Street Wants to Raise the Target Inflation Rate above 2 Percent Price inflation in the United States remains stubbornly high, with October’s print at 7.7 percent. The Fed’s preferred measure, so-called core inflation is only two-tenths of a percent below 40-year highs, at 6.3 percent. Yet, it was just last year that […]<\/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":[124,303,4800,33484,13351,14776,25781,3650,860],"class_list":["post-64458","post","type-post","status-publish","format-standard","hentry","category-economics","tag-central-banks","tag-fed","tag-inflation-target","tag-monetary-policy-interest-rates","tag-price-inflation","tag-ryan-mcmaken","tag-the-mises-institute","tag-us-federal-reserve","tag-wall-street"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/64458","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=64458"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/64458\/revisions"}],"predecessor-version":[{"id":64459,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/64458\/revisions\/64459"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=64458"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=64458"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=64458"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}