
Fed Chairman Powell Unravels Inflation Riddle - prostoalex
https://www.bloomberg.com/news/articles/2018-04-06/who-needs-an-economics-ph-d-as-powell-unravels-inflation-riddle
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dragonwriter
Today on _That 's Not What That Means_, we discuss how presenting an
ideologically-motivated simplistic alternative explanation for an effect
without supporting evidence is not the same thing as unraveling a mystery,
especially when the effect wasn't mysterious to start with, it's just that the
accepted explanation was inconvenient from the perspective of justification of
policy serving to reinforce the interests of the already rich.

That is, economists don't generally deny that increased competition via online
shopping reduces consumer prices and that increasing penetration of such
shopping reduces, to some extent, the rate of increase of those prices, i.e.,
inflation; OTOH, many of them have seen for a long time the actual low level
of inflation compared to aggregate economic performance in the US as driven
more by the fact that a historically large share of the returns of economic
growth are being captured at the top of the income distribution, having little
effect on consumer demand.

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rodionos
Fed's target is roughly where the 10-year average is, so it's easy to justify
a neutral stance.

[https://trends.axibase.com/491c2442/2/](https://trends.axibase.com/491c2442/2/)

