Ep. 5 | The Federal Reserve Series | When Policy Goes Wrong

When the Fed gets policy wrong, you pay the price.

In this episode, I break down how inflation and poor fiscal responses during COVID tanked household incomes — and why stable purchasing power must be a top priority.

Transcript:

Welcome back, folks. A Working Man's Guide. So back on point, stable purchasing power. You need to get better. The policy implications you see here are a direct responsibility of the Federal Reserve. Their scope is bigger than stable purchasing power and sound money, but that's right at the heart of it. That's why they exist. We look at what happened in recent times.

Here you see this spike got up to just under 10% annual inflation. Let's remind ourselves what that did to incomes. Give me a second here we look at this chart annual household income, as we did in the last series, you see this dip right? That was precipitated first by the COVID event, the COVID 19 virus, and the response to it, the economic lockdowns, and then the disastrous 21 fiscal spending packages that gave us the inflation we saw in the prior chart that drove these incomes through the floor. It was a major impact.

Now, when we come back next time, I'm going to scope out a rough estimate of cost, what that cost is. The main point here is, when we get policy wrong, it's it goes right to the citizen, right to the taxpayer. We need to demand better of our public institutions. Thank you very much.