Friday, July 30

Fed

Economy, Fed, Federal Reserve, inflation, Inflation debate, Inflation Expectations, inflation fears, inflation gauge, inflation outlook, inflation risk, Jerome Powell, Markets, MI Exclusive, Mohamed El-Erian, New cars, semiconductor chips, semiconductor shortage, Used cars

There is a fundamental misunderstanding of inflation and its spread throughout sectors of the economy proves it is not isolated or transitory, Mohamed El-Erian says

Mohamed El-Erian. Rob Kim/Getty Images Mohamed El-Erian said there is a fundamental misunderstanding of inflation because few people have lived through it. "I always laugh when people say, oh, it's isolated, it's transitory," El-Erian told CNBC on Monday. He also disagreed with the Federal Reserve's view that inflation is transitory. Sign up here for our daily newsletter, 10 Things Before the Opening Bell Economist Mohamed El-Erian in an interview Monday took aim at assessments of inflation that describe rising prices as "transitory," stating that there is a fundamental misunderstanding of what inflation is and how it is already spreading throughout the economy. "I always laugh when people say, oh, it's isolated, it's transitory," Allianz's chief economic adviser told CNBC. "I th...
Central Bank, Economic Recovery, Economy, Fed, Federal Reserve, Labor Market, labor shortage, Markets, Supply Shortage, Supply shortages

The Fed is bummed out by all the supply and labor shortages, too

The US is recovering well, but supply constraints and worker shortages present obstacles, the Fed said. Product shortages can provide "more lasting but likely still temporary upward pressure" on prices. New technology and retirements could keep the labor market from returning to its pre-crisis norm, the Fed added. See more stories on Insider's business page. Vaccination may be keeping COVID-19 at bay, but the pandemic's fallout lives on in supply shortages and labor scarcity, the Federal Reserve said Friday.March stimulus, vaccination, and the revers...
Central Bank, Economic Recovery, Economy, Fed, Federal Reserve, Full employment, Jerome Powell, Labor Market, Labor Markets, Lael Brainard, Larry Summers, Markets, maximum employment, monetary policy, Randal Quarles, Unemployment, US Labor Market

The government is pursuing’maximum employment’ for the first time. Here’s how it differs from’full employment’ and the risks it brings.

The Fed is targeting "maximum" employment over "full" employment in a major shift for the US economy. The new goal aims to bring forth a more equitable rebound, particularly for minorities and low-income households. This focus tests how many Americans can be hired before an inflationary spiral is set off. See more stories on Insider's business page. Maximum employment. Full employment. They may seem to be similar phrases, but they are dramatically different, in ways that could shape the US economy long after the pandemic ends.After decades of adhering to an agreed-upon employment threshold called full employment, the ...