Bloomberg/Nishant Kumar/3-31-2022
“‘This combination of high inflation, tight labour markets, and uncertain inflation expectations introduces the prospect of a 1970’s style wage-price spiral which proved very costly to reverse during the Volcker Era,’ according to the note to shareholders of a listed fund, which it manages.”
USAGOLD note: That wage-price spiral was finally waylaid when the Fed pushed interest rates over the inflation rate, but it took more than 10 years to muster the political will to get the job done. The current inflation, we should keep in mind, began less than a year ago, and the Fed, at this juncture, has no intentions of applying the kind of medicine Volcker did in the early 1980s.
United States Inflation Rate Source: tradingeconomics.com
