Judging by all the policy mistakes Jerome Powell’s Federal Reserve is making, one has to wonder whether next year it will be accused of having been asleep at the wheel when another economic crisis …
After Lehman Brothers’ 2008 bankruptcy precipitated the Great Recession, the Federal Reserve was roundly slammed for having been asleep at the wheel at the very time a major economic crisis was brewing.
It might be asked: After raising interest rates at the fastest pace in decades, why did the Fed keep going without paying due thought to the long and variable lags with which monetary policy is known to operate?And why did it largely ignore the financial-market strains its policy was causing as well as theFederal Reserve Chairman Jerome Powell’s decisions could be sending the United States into another recession, according to Post columnist Desmond Lachman.
That could be setting us up for the opposite problem of great economic weakness and another period of flirting with inflation., failed as a result of large interest-rate-induced losses on their bond portfolios. Yet these looming financial-system problems have not deterred the Fed from its newfound monetary-policy religion.
China is the world’s second-largest economy and until recently was its principal engine of economic growth, so the country’s unfolding economic crisis has the potential of throwing the world into recession.
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