Pressure builds for Fed chief as inflation surges
By Sylvan Lane
The Federal Reserve is facing growing scrutiny from Wall Street and Washington over its cryptic plans to eventually pull back stimulus from an economy that’s starting to struggle with inflation. Fed watchers are eagerly seeking clarity from Chairman Jerome Powell about when the central bank aims to pare down the monthly purchases of bonds meant to dampen the economic blow of COVID-19…And other critics of the Fed’s approach say allowing near-zero interest rates and steady bond purchases to add further fuel to soaring stock prices will only deepen historically high economic inequality. While easy monetary conditions are intended to fuel job creation and economic activity, they can also encourage more speculative forms of investment since low interest rates lead to little growth for savers. “The new policy has been unintentionally but powerfully unequal, and a spike in inflation will be very powerfully anti-equality,” said Karen Shaw Petrou, author of “Engine of Inequality: The Fed and the Future of Wealth in America.” “It’s continued increase in its portfolio combined with rates that are negative in inflation-adjusted terms just drives not only a tremendous amount of wealth inequality, but also distortions in productivity.”
https://thehill.com/policy/finance/558405-pressure-builds-for-fed-chief-as-inflation-surges?rl=1