Warsh Spits in His Eye

Well... he done did it. Boy howdy. Now, Bone Spur Samurai^© doesn't know shit about econ, despite having (so he says) some kind of $.25 degree in a niche corner of econ as a two year undergrad at Wharton. He wants the unenlightened to assume he has the coveted (even when he spent two paltry years there) Wharton MBA. Not a chance.

The bedrock of inflation: where does it come from. At the macro level, there's too much demand (folks have more moolah than they should have, for some definitions of 'more' and 'should') and there's too little supply (where producers are too scared to make product, and don't). The Covid-19 inflation was mostly the latter on the way out. The in-Covid-19 inflation was both. Because so much of the global economy was ham-strung, supply slackened. OTOH, some Damn Gummints suplemented household incomes due to so many people being out of work, but producers were chary of supplying. So, we gots some inflation.

One might argue that we've been riding the slack-supply bronco ever since. Turns out, there are data sources. Here's one. There's some really simple, pretty, and informative graphs which lay out the situation.

Warsh et al have spit in Bone Spur Samurai^©'s eye, but, as is obvious from the graphs (and, just to remind, it's FED graphs) that we're still in a slack-supply inflation at nearly all data points since Covid-19. Bone Spur Samurai^© is a plain idiot. But he's kinda right, but mostly wrong. The Fed can't make producers market more product. Xi and Kim and Vlad can, of course, but it wouldn't be in Bone Spur Samurai^©'s interest to actually jawbone his billionaire buddies to lessen the problem. The Goldfinger way to get rich; destroy the "others" production and the value of yours rises. You tink he's upset about the reduction of global oil? Not a bit of it. Domestic oil is making a killing. Ah, the beauty of unfettered capitalism.

Putting the brakes on when supply lags demand, is exactly the wrong thing to do. What a Damn Gummint can do is a bigger issue, beyond my pay grade.