Problem is if FED is to raise interest rates commensurate with CPI, lets say to 5% for 10 year Treasuries, the annual interest payment on $30 Trillion will be about $1.5 Trillion. We already running budget deficits. So cut spending? Print more money?
There is no easy solution! Time for easy remedies is long gone.
“So cut spending? Print more money?”
They can do both, for all I care, but interest rates have to be higher, regardless.
“There is no easy solution! Time for easy remedies is long gone.”
You’re correct and many of the patients in the US economy, that have been babied and coddled aren’t going to like the medicine.
But Dr Jerome Powell is coming and they won’t have a choice.