It has repeatedly used this power in the last half-century, slowing growth and in some cases bringing on recessions. In each case, it has justified its decision to slow the economy through concerns about inflation. The argument has been that inflation risks getting out of control if the Fed allows the labor market to get too tight.
Biden Presidency May Depend on Reappointing Fed Chair
It would be difficult to overestimate the importance of the Federal Reserve Board. While it cannot always boost the economy as much as it would like when the country falls into a recession, the Fed’s ability to raise interest rates gives it the power to impede economic growth and to keep millions of people from getting jobs.
It has repeatedly used this power in the last half-century, slowing growth and in some cases bringing on recessions. In each case, it has justified its decision to slow the economy through concerns about inflation. The argument has been that inflation risks getting out of control if the Fed allows the labor market to get too tight.
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It has repeatedly used this power in the last half-century, slowing growth and in some cases bringing on recessions. In each case, it has justified its decision to slow the economy through concerns about inflation. The argument has been that inflation risks getting out of control if the Fed allows the labor market to get too tight.
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