by John Rubino
Dollar Collapse
So the Fed, confronted with 6% official (~ 12% actual) inflation, steps right up and … promises a few quarter-point interest rate hikes not today, but at some indeterminate dates in 2022. Even if it follows through — a big if based on recent history — the U.S. will still find itself with negative real interest rates of at least 3%. Which is to say with monetary policy that remains wildly inflationary.
Contrast this insouciance with much of the rest of the world, where other central banks are already tightening aggressively. From last week’s Wall Street Journal:
Central Banks Around the World Raise Rates as Fed Prepares Move
Central banks across swaths of the globe are continuing to raise interest rates in an effort to tame inflation, largely dismissing for now the threat to economic growth posed by the spread of the highly infectious Omicron variant.