Thursday, July 28, 2022

What Did You Think Recession Causing Policies Were Going To Do

I try to avoid making predictions, but when the policy is "cause a recession to stop inflation" (whatever the merits of that), it's probably going to succeed!
The U.S. economy contracted for the second straight quarter from April to June, hitting a widely accepted rule of thumb for a recession, the Bureau of Economic Analysis reported Thursday.
Causing recessions is the one thing "we" know how to do! Central banks are very good at it! It's easy!

Erring on the side of too tight money is almost always the policy, and certainly the most likely policy when Republican Fed chiefs work under Democratic presidents!