I was poking through White House press conferences from July 2021 - no particular reason! - and I came upon this gem from one Jennifer Psaki:
Yep, that’s Jen Psaki predicting - in July, not even seven months ago! - that inflation would rise 2.2 percent for all of 2022.
She’ll be lucky if it stays under 2.2 percent through April.
They really are this stupid and overconfident.
I have tried to avoid learning about the woke idiocy that is Modern Monetary Theory - more proof that academia is now entirely divorced from the real world.
Imma tell you a secret about inflation that you don’t need a PhD to understand instead: when it reaches the levels it is now, when it stops being background noise, when the word “spiral” starts getting tossed around, the only way to get out of it is to crush demand.
That means higher interest rates and REMOVING fiscal stimulus (aka raising taxes or cutting spending). That means a recession, okay?
Recessions are awful. But inflation is worse, because inflation ultimately both distorts the economy and is most dangerous to people who are not asset holders and/or do not have the financial savvy to protect themselves from it. In other words the working class and poor.
And the longer you go allowing prices to accelerate, the harder you have to slam the brakes to stop them.
THERE IS NO FREE LUNCH. NOT FOR INFLATION, NOT FOR COVID, NOT FOR CRIME, NOT FOR CANNABIS. NOT NOW, NOT EVER. You can party all you want, but the sun always comes up the next day.
Understanding this is the first step to being an adult.
Happy Valentine’s Day.
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