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J Λ M Ξ S (jmsdnns@mastodon.social)'s status on Monday, 04-Nov-2024 18:54:07 JST J Λ M Ξ S

I'll never forget the way the tech industry was sacrificed to counter inflation
Nov 2022: The Fed minutes show they want increased unemployment to stop inflation (1st pic)
June 2023: Bernanke and Blanchard say the labor market will have increasing influence of over inflation, and the Fed should continue slowing the economy (2nd pic)
May 2024: Where we are now, and tech roles are still rare. The few openings that exist still receive thousands of applicants
In conversation about 7 months ago from mastodon.social permalink
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1. The following is from this article in Forbes: https://www.forbes.com/sites/dereksaul/2022/10/12/does-the-fed-want-you-to-lose-your-job-its-complicated/?sh=2a1a67d3dff5 The Fed said in minutes released Wednesday "a softening in the labor market would be needed to ease upward pressures on wages and prices," adding the "transition toward a softer labor market would be accompanied by an increase in the unemployment rate," part of the central bank's recap of a September meeting during which it approved a 75-basis- point interest rate hike. Higher wages and lower unemployment rates both seem like good things for the economy, but there is a strong historic inverse relationship between unemployment rates and inflation, demonstrated by the Phillips curve familiar to Economics 101 students, a concept that Fed chair Jerome Powell said in 2018 "continues to be meaningful for monetary policy." And right now, the Fed's primary focus remains on doing everything possible to slow inflation, noting inflation remains "unacceptably high."
  https://files.mastodon.social/media_attachments/files/112/520/843/072/600/537/original/89889cb6af85f2ad.jpeg
2. The image shows highlighted text from the Bernanke & Blanchard paper published by Brookings, available here: https://www.brookings.edu/articles/what-caused-the-u-s-pandemic-era-inflation/ > To the extent that commodity prices stabilize and sectoral shortages moderate-processes that both seem well advanced as of this writing (June 2023)—the goods market component of inflation is likely to decrease in importance, and the labor market component to become more dominant. Looking forward, with labor market slack still below sustainable levels and inflation expectations modestly higher, we conclude that the Fed has to slow the economy to return inflation to target.
  https://files.mastodon.social/media_attachments/files/112/520/843/401/683/857/original/905f21fc7d773429.png

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