Jerome Hayden Powell, chairman of the Federal Reserve Board of Governors, predicted that the economy is expected to get going again as vaccination rates for the new crown (Chinese Communist virus) rise, but warned outsiders that the economy is in danger of overheating. Speaking at the Wall Street Journal Jobs Summit, Powell said the economy could recover and rebound slightly for now, but the U.S. economy could face high Inflation in the future.
Bauer added that, compared with the economic situation envisaged a year ago, the current inflation rate in the United States is below the Fed’s long-term target of about 2 percent.
The U.S. has been in a low-inflation situation for years, but this year the Nasdaq Composite Index (COMP) fell super significantly, so to speak, plunging 2.1 percent. Although the Nasdaq has continued to avoid falling into correction territory (down 10% from its recent high), but still can not return to previous gains, down 9.7% from its record high on February 12.
Bauer pointed out that: “If inflation still continues to rise, I hope the public can be patient.” Bauer believes that inflation is only a short-lived, one-Time price increases, not sustained inflation, but also warned the public that high inflation is a very bad situation, on fixed income and lower income people caused the most damage. The Fed will need to have a variety of conditions to raise interest rates, including making the job market close to the maximum employment rate, and make long-term inflation sustainable at about 2%, the time to raise interest rates will depend entirely on these conditions.
Bauer stressed that the expectation is that employment opportunities will increase in the coming months, although the labor market is difficult to fully recover in December, but the next few months are very important.
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