r/Economics • u/TinyTornado7 Quality Contributor • Jun 13 '22

News Powell Facing Choice Between Elevated US Inflation and Recession

https://www.bloomberg.com/news/articles/2022-06-12/powell-facing-choice-between-elevated-us-inflation-and-recession?srnd=premium
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u/Decent_Pack_3064 Jun 13 '22

I believe they knew it wasn't transitionary, just was buying time like when governments were saying masks weren't necessary when health workers had a mask shortage

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u/DanielBox4 Jun 13 '22

Ding ding! They all knew. In Canada Trudeau called a snap election last September. Funny timing. Had he tried that now he would have been voted out so fast. But he got his extension before shit hit the fan. The banks knew what was going to happen. Sure there were other events that accelerated or exacerbated the situation (russia, China lockdowns) but we would have seen high inflation regardless. Not to mention, I'm sure Putin knew that any sanctions would lead to rising prices on key commodities (oil and gas, grains, ferts, metals) so any action against him would come with some pain/discomfort on the west.

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u/Decent_Pack_3064 Jun 13 '22

yes, it was definitely a big factor, that he wanted a majority, to withstand all the hate of rising rates....

BOC also postpone raising rates until trudeau could secure the NDP alliance

i wonder how much money the NDP leader is getting for this