In today’s Washington Post Robert J. Samuelson has raised the possibility that the Federal Reserve may be setting the US up for a reappearance of inflation. He invoked the 1960s and 1970s when supposedly the Fed allowed inflation to get out of control out of a supposedly misguided effort to bring down unemployment by allowing successive small increases in inflation. Supposedly the newly released report on changed Fed policies may be taking us back to those bad old days, even though for now RJS admits that inflation is low, with expectations of inflation only at 1.34%. How worried should we be?
OK, I am not going to say that a resurgence of inflation is impossible. I can imagine it possibly resurging, with such a development perhaps being associated with a sharp decline of the US dollar, perhaps associated with a turn from its use as a reserve currency. I do not see that happening immediately, but there is theoretical literature that suggests that such an event could happen rather suddenly at some point. If so, then maybe it could happen. Is the new Fed policy likely to bring this on?
I suppose one reason to be concerned is that the supposedly new policy approach has been rather opaque. I have had trouble getting a clear picture what the changes are in the policy. The main reports have been relatively undramatic, basically an idea that at least through the next year there will be no interest rate increases. Probably a bigger deal is that the Fed might tolerate inflation higher than the 2% targeted rate.
https://www.nytimes.com/2020/09/03/us/food-pantries-hunger-us.html
September 3, 2020
Minivans at the Food Pantry: Meet America’s New Needy
The economic strain of the coronavirus pandemic has more Americans turning to food banks and charity for help feeding their families.
By Tim Arango
Photographs by Brenda Ann Kenneally
LAKESIDE, Calif. — This is America: a family crammed in a minivan driving mile after mile across San Diego County, first to one food giveaway and then to another and then to more.
To Mary’s Donuts, in rustic downtown Lakeside, for day-old chocolate frosted, maple-and-bacon glazed and pastries the size of catcher’s mitts.
Sixteen miles west to Jewish Family Service for big, fresh mangoes, boxes of hard-boiled eggs, cheese and lamb stew. Another 20 minutes south to the Ocean Discovery Institute for diapers and school supplies. To the Salvation Army for bottled water, oatmeal, a cake. All of it piled high into the back.
Since the coronavirus pandemic upended her life and so many others’, Alexis Frost Cazimero has spent most days this way, gathering food for her four children as well as neighbors in need. She pulls her packed silver Volkswagen van alongside the BMWs and Mercedeses as they edge their way through the long, snaking food lines. Where else but America can luxury and poverty get so close together that, in essence, they become one?
“I want people to understand, the face of the needy is different now,” said Ms. Cazimero, who has joined a new class of Americans who never imagined they would have to take a spot in a modern-day bread line. “Just because I have a car doesn’t mean I have enough money to buy food.”
The pandemic has exposed the fragile nature of success for millions of Americans: material markers of outward stability, if not prosperity, but next to nothing to fall back on when times get tough.
In conversations around the country this August — at kitchen tables, in living rooms and in cars during slow-moving food lines with rambunctious children in the back — Americans reflected on their new reality. The shame and embarrassment. The loss of choice in something as basic as what to eat. The worry over how to make sure their children get a healthy diet. The fear that their lives will never get back on track….