4min chapter

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What the Bailout of SVB Means for the Fed's Fight Against Inflation | Steven Kelly

Hidden Forces

CHAPTER

Is There a Way Around Credit Rationing?

I think Russell has nailed what I think is actually the path here. And this confirms that, which is to say that there's going to be credit rationing. The official mandates of the Fed are inflation fighting and maintaining balancing inflation and employment. But there's also financial stability and actually financial stability,.The unstated one is actually, I would say the priority. For example, we can think about inflation as very much akin to the zero lower bound on interest rates. That's where we were in 2008 and 2020. Now we're sort of in a world where the Fed won't cut rates.

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