The mistake-prone Federal Reserve could be sending us into recessionBy Desmond Lachman
Published Sep. 5, 2023
After Lehman Brothers’ 2008 bankruptcy precipitated the Great Recession, the Federal Reserve was roundly slammed for having been asleep at the wheel at the very time a major economic crisis was brewing.
Why had it paid so little attention to the housing market bubble and the associated problems in plain sight with subprime lending?
Why did it underestimate the clear message Bear Stearns’ troubles in March 2008 were sending about a strained banking system?
Judging by all the policy mistakes Jerome Powell’s Fed is making, one has to wonder whether next year it will again be accused of having been asleep at the wheel when another economic crisis was brewing.
It might be asked: After raising interest rates at the fastest pace in decades, why did the Fed keep going without paying due thought to the long and variable lags with which monetary policy is known to operate?
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Source:
https://nypost.com/2023/09/05/mistake-prone-federal-reserve-could-send-us-into-recession/
