{"id":462138,"date":"2022-06-13T16:33:47","date_gmt":"2022-06-13T13:33:47","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/fed-still-much-too-optimistic-on-inflation\/"},"modified":"2022-06-13T16:33:47","modified_gmt":"2022-06-13T13:33:47","slug":"fed-still-much-too-optimistic-on-inflation","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/fed-still-much-too-optimistic-on-inflation\/","title":{"rendered":"#Fed still &#8216;much too optimistic&#8217; on inflation"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a245d6a4e4ff\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a245d6a4e4ff\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/fed-still-much-too-optimistic-on-inflation\/#%E2%80%9CFed_still_%E2%80%98much_too_optimistic_on_inflation%E2%80%9D\" >&#8220;Fed still &#8216;much too optimistic&#8217; on inflation&#8221;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9CFed_still_%E2%80%98much_too_optimistic_on_inflation%E2%80%9D\"><\/span>&#8220;Fed still &#8216;much too optimistic&#8217; on inflation&#8221;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div>\n<aside class=\"single__inline-module alignleft\">\n<\/aside>\n<p>Ex-Treasury Secretary Larry Summers warned that the Federal Reserve\u2019s forecasts on inflation have been \u201cmuch too optimistic\u201d so far \u2014 and warned that the US economy is teetering on the edge of a recession. <\/p>\n<p>Summers, an early and frequent critic of the Fed\u2019s response to surging inflation that reached fresh four-decade highs in May, also said he disagreed with current Treasury Secretary Janet Yellen\u2019s recent claim that there was \u201cnothing to suggest a recession is in the works.\u201d<\/p>\n<p>\u201cWhen inflation is as high as it is right now and unemployment is as low as it is right now, it\u2019s almost always been followed, within two years, by recession,\u201d Summers said during an <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cnn.com\/videos\/politics\/2022\/06\/12\/summers-full.cnn\">appearance on CNN<\/a>. \u00a0<\/p>\n<p>\u201cI look as what\u2019s h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ening in the stocks and bonds markets, I look at where consumer sentiment is, I think there\u2019s certainly a risk of recession in the next year and I think given where we\u2019ve gotten to, it\u2019s more likely than not that we\u2019ll have a recession within the next two years,\u201d Summers added.<\/p>\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/grocery-27.jpg?w=1024\" alt=\"Grocery shopper\" class=\"wp-image-22633333\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/grocery-27.jpg?quality=75&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/grocery-27.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/grocery-27.jpg?quality=75&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Inflation hit 8.6% in May.<\/figcaption><figcaption><span class=\"credit\">Getty Images<\/span><\/figcaption><\/figure>\n<p>The dire warning followed a dismal May Consumer Price Index release that showed inflation jumped 8.6% \u2014 its fastest rate since December 1981. The numbers added to the challenge facing the Fed, which is attempting a high-wire effort to cool prices by hiking interest rates without tipping the economy into a recession.<\/p>\n<p>Yellen, who recently admitted she was \u201cwrong\u201d about inflation\u2019s path, said last week that economic growth would \u201cabsolutely\u201d slow as the Fed imposed rate hikes but a recession was unlikely.<\/p>\n<p>\u201cI don\u2019t think we\u2019re (going to) have a recession. Consumer spending is very strong. Investment spending is solid,\u201d Yellen told a New York Times Dealbook event.<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"683\" height=\"1024\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/Lawrence-Summers-54.jpg?w=683\" alt=\"Larry Summers\" class=\"wp-image-22633335\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/Lawrence-Summers-54.jpg?quality=75&amp;strip=all&amp;w=1366 1366w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/Lawrence-Summers-54.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/Lawrence-Summers-54.jpg?quality=75&amp;strip=all&amp;w=683 683w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/Lawrence-Summers-54.jpg?quality=75&amp;strip=all&amp;w=341 341w\" sizes=\"auto, (max-width: 683px) 100vw, 683px\"\/><figcaption>Larry Summers has been critical of the federal response to inflation.<\/figcaption><figcaption><span class=\"credit\">Getty Images<\/span><\/figcaption><\/figure>\n<p>Meanwhile, Summers told CNN that the decades-high inflation could rise even higher in the months ahead depending on the price of oil, which has surged since Russia launched its brutal invasion of Ukraine.<\/p>\n<p>\u201cThere\u2019s a risk that it will rise higher and I don\u2019t think it\u2019s likely to fall back very, very rapidly. I think the Fed\u2019s forecasts have tended to be much too optimistic there and I hope they\u2019ll recognize fully the gravity of the problem in their forecasts when they meet this week,\u201d Summers said.<\/p>\n<p>The Fed is expected to announce a rate hike of a half-percentage point at its meeting this week, with similar aggressive action expected in July and the months ahead if prices do not cool. The central bank\u2019s previous half-percentage point hike in May was the sharpest increase of its kind since 2000.<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/jerome-powell-21.jpg?w=1024\" alt=\"Fed Chair Jerome Powell\" class=\"wp-image-22633334\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/jerome-powell-21.jpg?quality=75&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/jerome-powell-21.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/jerome-powell-21.jpg?quality=75&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Fed Chair Jerome Powell has indicated aggressive rate hikes are on the way.<\/figcaption><figcaption><span class=\"credit\">Kyodo <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> via Getty Images<\/span><\/figcaption><\/figure>\n<p>Summers, who served as a top economic official during the Clinton and Obama administrations, added that there is \u201cnot a lot\u201d that President Biden can do at this point to address gas prices that reached record highs over the weekend.<\/p>\n<p>Summers said a \u201cstrategic\u201d reduction in tariffs on China, as well as an overhaul of the corporate tax code and a reduction of prescription drug prices, could have a positive effect on inflation.<\/p>\n<p>\u201cWe should focus on what\u2019s important, not raising input prices for American producers so they\u2019re less competitive, which is what much of those tariffs do,\u201d Summers said.\n                        <\/p><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more News articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/nypost.com\/2022\/06\/13\/larry-summers-fed-still-much-too-optimistic-on-inflation\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;Fed still &#8216;much too optimistic&#8217; on inflation&#8221; Ex-Treasury Secretary Larry Summers warned that the Federal Reserve\u2019s forecasts on inflation have been \u201cmuch too optimistic\u201d so far \u2014 and warned that the US economy is teetering on the edge of a recession. Summers, an early and frequent critic of the Fed\u2019s response to surging inflation that&#8230;<\/p>\n","protected":false},"author":1,"featured_media":462139,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/newspress-collage-22633290-1655127136034.jpg?quality=75&strip=all&1655112814&w=1024","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[81188,130276,70551,78738,88069,91261],"class_list":["post-462138","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-janet-yellen","tag-6-13-22","tag-inflation","tag-jerome-powell","tag-larry-summers","tag-recession"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/462138","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=462138"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/462138\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/462139"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=462138"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=462138"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=462138"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}