Two of the most knowledgeable economists discussing events leading up to this year’s high inflation and the resulting interest rates. Of course, the Fed is reacting to the high inflation rates. If we look out into the future, probably early next year for a recession.
OER should not be used by the Fed in setting policy. The Fed is currently chasing a phantom lagging menace.
“Actual* rents and house prices lead the CPI measures by about a year.” In our neck of the woods, home prices are dropping, sales are down, and mortgage rates are about 6%. Inflation remains high. Hat Tip to New Deal democrat for sending this conversation. Thanks NDd..
Larry Summers projects his thoughts on Inflation.
Paul Krugman Responds . . .
People can still find work. They do crab about gasoline prices.
“September consumer inflation; function of fictitious “owners’ equivalent rent + new cars” – Angry Bear
“Interest rates, the yield curve, and the Fed chasing a Phantom (lagging) Menace” – Angry Bear