Steve Forbes Excoriates Jerome Powell: “Clueless About Inflation!”

Federal Reserve Chairman Jerome Powell sent financial markets reeling when he told a Senate hearing Tuesday that our central bank is ready to push up interest rates higher and at a faster pace than previously anticipated.

Why? Because the economy has been showing unexpected strength; therefore, the Fed may have to do more to suppress it.

And here we get to the fundamental flaw in central bankers’ and most economists’ approach: They think prosperity causes inflation. To cure that, they work to depress the economy.

They’ve never understood the definition of inflation: reducing the value of a currency, usually by creating too much of it. Price increases from natural disasters, wars, Covid lockdowns or economy-killing regulations and taxes cannot be cured by jacking up interest rates.

The Fed is—and will be—inflicting unnecessary pain.