Quote:
Originally Posted by nis350
of course, it is the very basic concept of supply and demand. The price in general is a result of that equation. I know someone who bought an 911 GTS in the middle of 2020 for $20K off msrp because nobody was buying cars. You can't even touch the same car for at least $20K over msrp now.
IMO, Powell is failing in fighting inflation. He sat on his behind for way too long... "transitory" my a$$. All these crazy rate hikes and QT's haven't done much. Perhaps a recession is needed.
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Historically, each time the Feds have previously tried to fight inflation, it always resulted in a recession.
The current economic state is a different scenario and COVID19 had a significant influence on this. It all comes down to supply. IMO, rate hikes, QT's/QE's, a recession will not resolve the current economy. The goal of the rate hikes is to discourage borrowed spending and subsequently lower demand, which also in turn lowers employment. Why do you think employment hasn't gone down even with the significant frequency of rate hikes? Why you do you think inflation hasn't cooled? The demand is still very much there, but the supply is severely lacking, so employers/companies are still in production mode with what materials they have available (hence why the employment rate isn't being lowered).
My biggest concern is that we could be headed for a stagflation at this rate.