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Things are only getting harder for the Fed

The Fed faces trade-offs in deciding on its rate policy next week amid rising inflation, global debt, and a weaker China.

  • Fed and other financial leaders acted decisively to prevent the Silicon Valley Bank collapse from becoming systemic.
  • Unlike in 2008, inflation is still running hot, and global debt has skyrocketed.
  • Ultra-low borrowing rates cannot be counted on this time around due to various factors.
  • China's weaker position will not allow it to hold up global growth during the next recession.
  • The Russian war in Ukraine is a continuing supply shock that accounts for a significant part of the inflation problem.
Things are only getting harder for the Fed
We should be thankful that the past two weeks of banking stress did not happen sooner