Powell vs. the Pandemic: Some Simple Monetary Arithmetic

The lack of inflation in 2020 despite the fastest money growth rates since World War II at first seems puzzling for anyone believing that still matters. monetary expansion merely offset effects declining velocity and reduced spending associated with lockdowns, however, making scale both appropriate justified. subsequent uptick 2021 accelerated 2022 was caused not by rapid but rather Federal Reserve’s failure to sufficiently adjust policy as environment changed. need is clearly demonstrated data analyzed this paper. It took far too long Reserve recognize problems inherent continuing its bent into 2022.