Summers: We've Seen This Movie Before

Lawrence Summers, Former US Treasury Secretary, weighs in on the cooler than expected July CPI numbers, and on what's in and what's out of the Inflation Reduction Act.
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[kevin-hmrv]

I appreciate Mr. Summers' insightful comment. Of all the voices in the media, I trust his especially on the topic of inflation.

[cato]

Summers is the only guy I like to listen to in the topic. Usually measured and level headed analysis. Personally I don’t care about airfares, cars, and hotel rates. All that matters is housing, energy, and food.

[vishalsaroha]

Well tempered advice. Fed reacting to any data numbers would be akin to Fed having taken on the role of market participant rather than as a facilitator of smooth functioning of markets. The uncertainty thus is added by Fed itself, by the drama around Fed meetings which is unnecessary. If the Fed were in Battle mode which they should be if they are data deoendant then they should organize meetings every month until normalizatiin.

[MyInfotainmentFix]

PE guys keep getting away with low tax no matter which party is in power. Goes to show how all politicians can be bought!

[KT-zxjr]

Given all the years of research that has been done, why are there still terrible policy mistakes made every year? Its like nothing has been learned. Perhaps we need to raise the bar for politicians and their ideas and put policy forward that is statistically sure to benefit the economy and average household - not super rich and special

[sumitomoOO]

This is like in April2020 everybody cheered when we "flatten the curve on Covid"...worst is behind us, we will open up in May....mega sense...that turned out to be flatten a bit then spike again

[headspaceandtiming]

We have spent far beyond our means since 2000. We made these choices.
QE, bailing out banks, the war in terror, social programs we can’t afford, ridiculous Covid bailouts and unemployment. We need to crank up the Fed rate to meet inflation. We have to deal with a recession while the economy can handle it. And show this generation we can all be great too. Yes this generation that has to learn to bare the consequences instead of act like a bunch of victims with their hands held out.
Don’t be scared. America had been through worse.

[tiger_would]

We have a debt based system. The Fed MUST continue to print and borrow otherwise the ponzi ends

[jpsmith]

Significantly better? This is what it looks like when media outlets don’t care that they don’t have credibility.

[johnmerlino]

The stock market surged on bad numbers. The only components that went down from Headline CPI was energy and these commodities move up and down very fast based on inventories, war, storms, etc. The reaction in the markets was like our CPI was 2%, it was 8.5%! Food inflation is raging! I really feel bad for families with children to feed. Shame on Biden's Federal Reserve (don't try and tell me the Fed is independent) for creating this inflation as they under react with small slow interest rate hikes. Higher Inflation = Higher Taxes (but without voting). This is the biggest wealth transfer by the Fed /Central bank in history, away from babyboomer savings into all these trillions of dollars of new bills being passed. Biden is spending our future away as our USD savings are being Debased.

[sumitomoOO]

Rich lobbyists write the law that favors mega wealthy

[yeoldbandicoot]

Everything is up on a month-by-month basis. Only laggard as oil and oil products. It will be higher again next month.

[AH-fmrj]

The whole problem is QE. As long as FED and ECB do QE we will never have a healthy economy. Thanks to putting all that QE on MBSs, the whole Western economy became housing market.

[williamandrews]

It is horrible to raise taxes on people who produce real products and services, and then give their money that they have earned to politicians who are already totally wasting $Trillions !!

[manatee]

If I was president I would get rid of all the lobbyists. Have a flat tax system. For all government employees get rid of all their benefits and they make no more than 50% above the minimum wage. Enforce the Constitution.

[KT-zxjr]

Politicians that bend the knee to tax breaks to certain groups should be shown the door unless they can statistically prove the overall economy and household benefit from their policy support ....

[us]

the interest rate hasn't started to bite.

[billcarney]

Not enough people are talking about HIGH RENTS!

[vishalsaroha]

On the question whether Rates are important or Balancesheet management, to battle Inflation on realtime basis, just replacing Inflation which may be growth related shadow, here with Paper currency devaluation may do the magic. Despitectwo year lockdowns it is only essentials of day to day use, travel, infrastructure that have spiked up in comparison to Fiat cuttencies which have barely budged inter se except following interest rate adjustments. So gues if this is the root cause of inflation, raising rates will only cause a recession surely and slowly with a lag. It is the liquidity which was provisioned during GFC to keep banks and fin institutions working needs a concurrent and quick withdrawal

[AR-rnok]

Is everyone going to be shocked when they increase another half point and not a quarter point?