Fed's Brainard: There's a risk of raising rates too much

[brooklynite]

Source: Axios

At some point, the Federal Reserve will face the risk of raising rates too much, a top official said Wednesday, while asserting the central bank will remain resolute in its drive to bring inflation down.

Driving the news: Lael Brainard, the No. 2 official at the central bank, acknowledged risks that the Fed could overdo it on interest rate increases, a sentiment notably missing from Chair Jerome Powell's hawkish speech in Jackson Hole, Wyoming, in late August.

"At some point in the tightening cycle, the risks will become more two-sided," Brainard said, according to the prepared text of a speech before a banking group in New York. The rapidity of rate increases and uncertainty about the pace of their economic effects "create risks associated with overtightening," she continued.

But Brainard also warned that history teaches "it is important to avoid the risk of pulling back too soon" and said that, when it comes to inflation, "our resolve is firm, our goals are clear, and our tools are up to the task."

Read more: https://www.axios.com/2022/09/07/fed-brainard-rate-increases

[Yavin4]

1. Corporate America desperately wants a recession for two main reasons

1. They want to put the fear of God back into employees. Between increased unionization, the demand to WFH, the Great resignation, etc. Workers are gaining more power and a recession scares them back into submission.

2. They want to stop Biden's agenda which they see as a departure from Neo-Liberalism and towards more Social Democracy. A major recession would cause political headaches for the Biden admin. Oh, and Corporate America is okay with Trump re-taking the White House.

[FSogol]

4. +1. Exactly. N/T

[elleng]

2. No sh*t, sherlock!

[twodogsbarking]

3. The risk is people not sending Wall Street their money.

IRAs were created to filter the money to stocks.