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| That is a very reasonable take. The irony is this wealth effect feeling is probably just that. Most of that $14T is due to home inflation and retirement accounts - both illiquid. So I don't think it is exactly their wealth feeding GDP but more their "I feel wealthy so lets go shopping".
I agree that the 2% inflation goal wasn't very likely without a recession. I am somewhat surprised that the same Fed that was willing to die on the "inflation is transitory" hill now appears pretty dug in on their goal. I honestly thought they would back off 50-100 bps once we fell below 3%. I won't criticize them for staying where they are for awhile.
Employment data will be important to watch through summer. Probably more so than CPI / PPI. | |
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The main reason Interest rates will go unchanged through November
