Jackson Hole & the Big Inflation Misconception

Last week, during the Fed’s wildly anticipated annual Jackson Hole meeting, Chairman Jerome Powell delivered hawkish remarks on the economy and the degree to which the central bank is going to focus, at all costs, to bring down inflation. He talked about the consequences of tight monetary policy and how it may mean a period of difficulty for the labor market and economic growth, but this cost is necessary to get inflation under control. In the 1980s, Paul Volcker eased up on their policy too quickly and inflation accelerated again.