So the theme is ‘the Fed is getting behind the curve’ That is, Yellen keeps rates ‘too low’ causing the economy to overheat. Complete nonsense, of course, but it drives markets until it doesn’t. Much like QE. The 0 rate policy, including QE, remains no way supportive of growth and employment, but instead deflationary and […]
Tag Archives: Janet Yellen
Yellen on wages
When asked about the growth in hourly wages: Most measures of wage increases are running at very low levels. Wage inflation closer to 3% or 4% would be expected given some measures, such as productivity growth. But right now it is certainly not flashing. An increase in it might signal some tightening or meaningful increase […]
Inflation Picture has Deteriorated
He’s on the opposite spectrum from Yellen, but inflation has deteriorated to the point where risks are elevated. Once the fed has figured out it can control the FF/LIBOR with TAF type or repo and ‘market functioning’ somewhat restored, I expect that the imperative to cut rates will be greatly diminished. Fed’s Lacker: Inflation Picture […]