The Fed and Obliviosity
The Fed and obliviosity. Yeah, it’s not a real word. I made it up 18 years ago. Why not? New words are constantly being added to the dictionary. So, I came up with “obliviosity” and its definition: a rapidly growing, annoying trait of modern society and our workforce that embodies feckless behavior, a lack of attention to detail, and a chronic absence of pride in one’s work. I wrote about this in a column years ago.
Neil Kashkari, President of the Minneapolis Fed and known for his role during the Great Recession, recently said in an interview, with a straight face, that one of his learnings over the past several years is that people would rather see the economy fall into a recession than continue suffering from soaring prices. According to him, the American people—and maybe Europeans too—viscerally hate high inflation. This was on a Financial Times podcast.
I mean, really? Of course, people hate inflation. It’s like New York Jets fans hating losing. I was blown away by Kashkari’s obliviousness. If you look at polls right now, many Americans believe we’re in a recession. Ask them to define it, though, and more than eight out of ten probably couldn’t tell you it means two quarters of negative economic growth in a row, usually accompanied by rising unemployment.
We actually experienced this about 18 months ago. But the National Bureau of Economic Research (NBER) decides if we’re officially in a recession. Let me ask you, Neil and other Fed members: do you think people can endure a couple of quarters of negative economic growth more easily than years of rising prices that never go down? This highlights how out of touch they are.
To use another sports analogy, I like my teams to win. As a New York Yankees fan, I don’t care if Aaron Judge leads the league in home runs unless it helps win the World Series. Winning is all that matters! Do you think Americans are glued to CNBC, waiting for GDP numbers? What a load of horse crap! They don’t care. Anyone who looks at our GDP numbers knows they’ve been weak and propped up by government deficit spending.
By all metrics, the economy is strong, they say. Sure thing, Neil. Keep telling yourself that. Obliviosity is like an infectious disease.
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