Cleffy is discussing:

The head of the International Monetary Fund said the United States may have to endure economic ‘pain’ in order to rein in inflation

I don't think these people understand the point of raising interest rates to combat inflation. It isn't to stop the inflation. That's going to happen regardless unless your economy can offset the rise of inflation with GDP growth. That won't happen with raising interest rates. The point of raising interest rates is to cause a recession and reduce demand so the effects of inflation are spread out over time instead of all at once. Simply stopping the money printer and not artificially causing scarcity will stop increased inflation. But we will see inflation from the previous money printing happen sooner.

loading...
Dissenter
connecting...