Said a wavering dove at the Fed:
"With no growth in employment ahead,
We're tempting the fates
By holding down rates,
So we'd best fight inflation instead."
As reported by Kelly Evans in the Journal's Ahead of the Tape today, even some dovish governors of the Fed are worried that inflation may return ahead of job growth. All signs point to a "no-hire, no-fire" job market, in which companies earn renewed profits from a skilled and less dispensable work force, while many unskilled jobs have structurally disappeared and cannot be brought back by monetary stimulus. Meanwhile, both headline and core inflation figures show signs of picking up, leading erstwhile doves to make hawkish suggestions for gradual 1% hikes in the Fed funds rate.
Really good one!
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