Biden will give us repeats of the worst of both Nixon and Carter.

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THAT ’70S SHOW: Get Ready For Price Controls If Inflation Jumps.

If inflation persists, and the Fed caters to political pressure to keep rates near zero to finance the growing federal debt and prop up asset prices, it would be tempting for progressives to call for price controls. Those controls would be dressed up as a temporary measure to stabilize prices and win votes, but they would not address the underlying inflationary pressures stemming from excessive money growth and fiscal dominance.

Fed governors Lael Brainard and Randal Quarles have assured us that the Fed has the tools to counter inflation—namely, increasing interest on reserves (IOR) and selling assets to reduce the size of its massive balance sheet. Yet, it may be politically difficult to use those tools: any significant increase in IOR to ward off inflation—paying large banks billions of dollars to park reserves at the Fed—would be untenable; and any call for tapering could cause a tantrum on Wall Street, just as in 2013. The Fed does not want to risk throwing the economy into recession by raising rates, but if it stands still inflation could worsen.

The view from here looks like Biden will give us repeats of the worst of both Nixon and Carter.

See also  Biden is buying votes with taxpayer money

Public pins blame for rising inflation on Biden: Poll

A new poll reveals that voters pin most of the blame for rising inflation on President Joe Biden.

Biden takes most of the blame among likely voters for rising inflation, with 39% saying he is responsible for the issue. Meanwhile, former President Donald Trump was blamed by 17.7% of respondents, according to the results of a newly released Trafalgar Group/Convention of the States poll.

The poll also revealed that some voters feel Congress is to blame for rising inflation, with 14.4% blaming the current Congress, compared to 10.9% who blame the previous Congress.

Biden’s $6 trillion spending spree could send inflation soaring

President Joe Biden‘s plan for a $6 trillion spending spree could risk overheating a US economy that is already rebounding from the COVID-19 pandemic and send inflation spiraling out of control.

Biden has announced three major tax and spending proposals that he argues will boost the economy, including the $1.9 trillion American Rescue Plan to give COVID-19 aid that already passed in the Senate.

He also laid out plans Wednesday night for a $2.3 trillion American Jobs Plan and an American Families Plan worth $1.8 trillion at a time when national debt is at its highest level in 76 years.

The Biden Administration argues its spending spree can boost the economy without negative side effects, but economists – both liberal and conservative – are warning it’s a gamble.

 

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