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You won't believe what is really behind the Fed's rate hikes & inflation rhetoric.

Eurodollar University

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What Is a Temporary Recession?

In 1964, Milton Friedman put forward this hypothesis of what he called a plucking model for the economy. In his analogy, output is viewed as bumping along the ceiling of maximum feasible output except that every now and then it is plucked down by a cyclical contraction. That to him seemed what these recession business cycles seem to be all about. The economy would be moving upward along its potential and then it would deviate into a contraction but unlike depression would come right back to its potential in no time.

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