We have already eaten a ton of inflation, particularly in the first year or so when Biden was President. Trump printed trillions to forestall a collapse during covid. The wisdom of that move is lost on me. I would have preferred the collapse--we might be recovering by now instead of sitting on an even higher precipice awaiting the inevitable fall.
There is an interesting argument to be made that they have no choice once the problem passes a certain point.
The interplay between bond yields, the fed funds rate, and inflation can lead to weird situations. Right noe the Fed is having to lower rates because (a) job numbers are pretty bad and (b) the US debt is held in a surprising number of short term bonds and higher rates make the debt just rack up faster. They're also watching inflation continue to chug along higher than their 2% target though, a scenario they'd normally raise rates for.
I won't be surprised if we ultimately realize that, in the end, those in charge had way less control of the economy than they like to claim. I'm biased though, that's always been my view and it frustrates me that economics claims to be a field of science at all. It can be a very interesting and important historical analysis but it isn't predictive, and at the level of macroeconomics it can't realistically be isolated and tested.
When you outsource all your jobs that actually produce goods instead of services, you have nothing left to offer. At the same time, we're proving that short-term consumerism is completely destructive (designed to break is just another variant of the broken window fallacy).
Either you lower US standard of living to match the countries it is currently outsourcing to or you establish protectionism and isolationist policies with a focus on total efficiency rather than short-term gains.
