For example, my favorite frozen chicken at Costco was $3/lb 2 years ago. It's $5/lb now. Does the FED want the return of $3 chicken, or is it happy with $5 (so long as $5 doesn't become $7)? Is the “Soft Landing” commonly referenced indicating one over the other, or some hybrid of both?
I don't see a way to return to $3 chicken via quantitative tightening and increased interest rates without some pretty significant drama in the economy and stock market. Yet, leaving prices where they are seems likely to decrease discretionary spending on things like vacations. That might rattle the AirBnB industry, which has been somewhat optimistic in its use of leverage. That might start a housing sell-off in some markets. Obviously, not curtailing inflation offers myriad other problems. What do you think?
If this has already been discussed somewhere else, I'd love a link to that discussion.
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