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The Fed’s failure to stem inflation is partly due to events outside the United States — Putin’s war in Ukraine, China’s lockdown, and post-COVID demand worldwide exceeding worldwide supplies of all sorts of materials and components.
But it’s also because domestic inflation is being driven by profits, not wages. And interest rate hikes don’t reduce profit-driven inflation — at least not directly. Instead, workers and consumers take the hit.
@LiberalEffects Also, that makes me more qualified than Kudlow to hypothesize about the economy. He's even less an economist. Also I did less blow than he did.
@LiberalEffects I'm not an economist, but I have an MBA and know the classical theories about inflation are not applicable to today. The Fed is basically acting like Larry Kudlow would if he were on the Fed. It's fucked up.