JPow has said, "We're going to raise rates up to the point that they become restrictive and hold them there until the inflation rate gets down to 2%".
If he sticks to that plan, rates won't go all that high, but will remain high enough, long enough to be recessionary. If he wants to quell inflation, this is the MINIMUM he should do. Investors shouldn't be hoping for something better.... unless he caves, of course.
Apparently paring down the Fed's balance sheet is even more restrictive than higher interest rates and a problem for credit liquidity, so is not being emphasized at this time, in spite of claims of "paring Fed balance sheet by $95B/mo". (?). I dunno.
If he sticks to that plan, rates won't go all that high, but will remain high enough, long enough to be recessionary. If he wants to quell inflation, this is the MINIMUM he should do. Investors shouldn't be hoping for something better.... unless he caves, of course.
Apparently paring down the Fed's balance sheet is even more restrictive than higher interest rates and a problem for credit liquidity, so is not being emphasized at this time, in spite of claims of "paring Fed balance sheet by $95B/mo". (?). I dunno.
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