The Fed is Retarded

ZH: Global Economy Heading For "Mother Of All" Supply Chain Shocks As China Locks Down Ports

There are always multiple parts moving in the economy. Commodity prices could be ready to collapse along with economic activity. That said, I am certain that if supply chains are snarled, stimulating demand, which the incoming Fed Chair and Vice Chair admit is all they can do, is a terrible policy. Stimulating demand when demand is constrained by supply encourages non-linear price increases that further distort economic activity and often triggers a generalized rise in the price level. Eventually, the booms turn into busts because money is distrubited unevenly. Say some people really need cars and have inflated dollars coming in. They can drive up car prices for everyone, leading to a collapse in car demand.