(RoyalPatriot.com )- Christopher Waller, the member of the Federal Reserve Board of Governors, has indicated that the central bank could begin increasing interest rates and ending the aggressive quantitative easing that defined the COVID-19 pandemic era.
The Federal Reserve has repeatedly said that the almost zero percent interest rate target will not be amended, even though inflation has risen dramatically since President Joe Biden took office. The Federal Reserve also indicated that the target of $120 billion monthly bond purchases won’t be changed – a measure designed to increase the supply of money (quantitative easing) to help stimulate economic activity.
The problem, however, is that it’s hard to stimulate economic activity when businesses are being denied employees, thanks to the government providing huge unemployment benefits for people who would simply rather stay at home.
Waller appears to recognize this. As one of the top seven economists tasked with managing the United States’ monetary policy, he now believes that the stimulus has completed the objective of stimulating and promoting recovery after the lockdown and that they could soon begin making changes to the interest rate.
Speaking to “Squawk Box” on CNBC, Waller indicated that “substantial progress” has been made and that an announcement will be made in September. He said that if the next two jobs reports are as “strong as the last one,” then that’s all the progress we need.
It’s funny, because the last jobs report was nowhere near as strong as initially expected, given that the Democrats refused to back down on continuing to provide additional unemployment payments to people who don’t want to return to work yet.
In Waller’s view, the Fed should raise rates in case further monetary stimulus is necessary next year.
Imagine that. Biden printing and spending more imaginary money next year, too.
Will this pandemic ever end?