Ep 9: Inflation: What Workers Need to Know
Class Matters
00:00
The Federal Reserve's Response to Inflation
For the last 40 years, the principal response to inflation has come from the Federal Reserve. By raising interest rates, the Federal Reserve intends to slow down economic activity. And by slowing down economic activity, they intend to increase unemployment and put downward pressure on wages. The underlying cause of higher wages is workers with some bargaining power; that's addressed through poor economic conditions.
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