ballpoint

I can't wait for the future

Volcker didn't have to worry about the huge debt to GDP ratio that Powell does, meaning Powell faces a huge predicament, as the Chicago Fed laid out in this White Paper presented at Jackson Hole: "When fiscal imbalances are large and fiscal credibility wanes, it may become increasingly harder for the monetary authority to stabilize inflation around its desired target. If the monetary authority increases rates in response to high inflation, the economy enters a recession, which increases the debt-to-GDP ratio. If the monetary tightening is not supported by the expectation of appropriate fiscal adjustments, the deterioration of fiscal imbalances leads to even higher inflationary pressure. As a result, a vicious circle of rising nominal interest rates, rising inflation, economic stagnation, and increasing debt would arise." https://www.kansascityfed.org/Jackson Hole/documents/9037/JH_Paper_Bianchi.pdf In short, Powell sees his choice between being Volcker or Arthur Burns (Fed Chairman from 1970 - 1978, whose "president friendly" policies - Nixon appointed him in 1970 and gave him instructions to ensure easy access to credit when he (Nixon) was running for reelection in 1972 - are widely seen to be a major cause of the high inflation over that period). This White Paper argues that Powell's choice is really between “sustained high inflation” or “depression.” Or, to put it in terms of previous Chairmen, between Arthur Burns and Benjamin Strong - the Fed Chairman who overtightend the world into the great depression. He can not be Volcker, and many analysts are still predicting that he will be forced to pivot sooner rather than later. On top of this, the question of political will to must still be considered. In order to placate the voting public, the right fiscal decisions aren't always (some would argue very rarely, or never at all) made. A point well made in this brilliant 2007 quote by Jean-Claude Juncker when Prime Minister of Luxembourg: "We know what to do, we just don’t know how to get re-elected after we have done it."

"It was man who ended the Cold War in case you didn't notice. It wasn't weaponry, or technology, or armies or campaigns. It was just man. Not even Western man either, as it happened, but our sworn enemy in the East, who went into the streets, faced the bullets and the batons and said: we've had enough. It was their emperor, not ours, who had the nerve to mount the rostrum and declare he had no clothes. And the ideologies trailed after these impossible events like condemned prisoners, as ideologies do when they've had their day". - John le Carre And that 'emperor' who had the nerve was Mikhail Gorbachev. RIP.

They can always move to the Huawei App Gallery.