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| Not deflation but disinflation occured with CPI getting down to 0.1% in 2015, while the Fed was monetizing debt via QE and running ZIRP. This low rate environment enabled borrowers to get loans easier. Land sure cashflows better at 3.xx% than 6.xx%. So M2 increased with bank sector loan growth and QE debt monetization by the Fed. I think ZIRP and QE was a policy error and frankly a logic error by the Fed. I'm gonna call a spade a spade and point out the hypocrisy on their end... if Covid inflation was supposedly transitory, why wasn't crude getting cut in half treated as transitory? The Fed defenders would say they were still primarily focused on jobs in 2015, as they had been ever since 2009. The Fed when they screw up, often simply says "we were primarily focusing on the other half of the mandate." This is their scape goat. That said, it is a hard job they are given that most of the public doesnt understand enough to throw stones at. | |
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New fed chair policies
