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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 379.87+0.4%Nov 11 4:00 PM EST
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To: TobagoJack who wrote (161656)8/24/2020 9:06:59 PM
From: carranza2  Read Replies (3) of 217709
 
From Seeking Alpha, good for gold, I guesstimate

Powell speech set to suggest sea change in Fed's inflation approach
Aug. 24, 2020 5:01 PM ETBy: Jason Aycock, SA News Editor 43 Comments

Fed Chairman Jerome Powell is set to signal a significant policy shift this week during a "virtual Jackson Hole conference," including perhaps the Fed's biggest steps ever to goose inflation back up to a healthy level.The chairman's Monetary Policy Framework Review (due Thursday) is expected to include measures such as "average inflation" targeting, or letting inflation run higher than the usual 2% healthy target for a while if it's spent a considerable time below that level. (And it has been below that level for all but two years since the end of the Great Recession in 2009.)And it could brand Powell's tenure at the Fed as the opposite of Paul Volcker - whose sharp rate hikes in the '80s built a recession but tamped down price pressures.The goal appears to be avoiding "Japanification," or the deflationary environment that led to Japan's lost decade.Evercore ISI expects the Fed to "seek a moderate inflation overshoot during the recovery phase of this cycle."Combined with expectations that the Fed will reaffirm its commitment to full employment, the resultant policy moves likely require keeping interest rates anchored near zero until both employment and inflation are stabilized at healthy levels.But some observers are raising questions about whether the aggressive policy is still needed with the economy rebounding better than expected (and not coincidentally with stocks having recovered their pandemic losses).
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