Whatever Washington Says, The Inflation Will Last

Whatever Washington Says, The Inflation Will Last

Federal Reserve Board Chairman Jerome Powell at a recent news conference. (Photo by Alex Wong/Getty ... [+] Images) Now it is official. Authorities in Washington have at last admitted what everyone else in America has known for months: the country faces a painful inflation. For the longest time, while everyone groaned on the supermarket checkout line and sighed at the gas pump, Treasury Secretary Janet Yellen and Federal Reserve (Fed) Chairman Jerome Powell as well as President Joe Biden insisted there was nothing wrong. Inflation they said was "transitory." Now they seem to have awakened. They refuse to admit error (who in Washington ever does?) but they at least acknowledge reality and have walked back earlier comments. Chairman Powell at this last press conference stretched the word "transitory" to the point of adding a third definition to Webster's. The only reason the journalists in attendance did not laugh is because they were too polite. But if the rhetoric is verging on a joke, at least monetary policy has begun to change, and that is the important thing. The data is what finally turned the rhetorical tide. At the close of 2020, the Fed, using its preferred indicator the consumer price