Oct 23, 2023·edited Oct 23, 2023

The inability of Congress to control its spending and taxation policy makes inflation so much harder to tackle. With interest rates above GDP growth, it's a dangerous game of brinkmanship with the economy and inflation.

At some point we will realize that fed rates & QE/QT is too crude a tool to deal with inflation without causing broader problems. Hopefully that is sooner than when the economy crashes from these crazy rates.

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I think that we should be adding something like the automatic stabilizers via direct cash deposits in federally provided checking accounts. Unfortunately it's a bit harder to figure out how we'd handle the other side of things, automatic tax increases seem plausible, but automatic spending cuts seem like an even more blunt a tool than monetary policy.

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