Is the Fed Lying to You Again About Inflation?! Buckle Up, Buttercup!

Cleaning Your Room...of Economic Illusions

Alright alright settle down you chaos dragons. So Christopher Waller a man who apparently thinks the economy runs on the same principles as a Philadelphia Eagles’ play is dusting off the old 'transitory' inflation chestnut. This is after it spectacularly backfired during the last inflationary surge. It's like tidying your room promising it will stay clean this time even though we all know it will look like a bomb site in a week. But hey gotta admire the optimism right? Or is it something more sinister...?

The Tush Push of Economic Policy

Waller compares his economic philosophy to the 'tush push,' a play that either works like a charm or leaves you face planted in the dirt. He argues that just because it didn't work before doesn't mean you shouldn't try it again. Well I suppose if you keep pushing long enough you might eventually reach the goal line. Just be prepared for a few bruises along the way. The question is who's gonna get bruised? You me or those poor souls trying to make sense of it all?

Two Paths Same Destination (Maybe)

Now Waller lays out two scenarios: big tariffs and small tariffs. Big tariffs mean a bigger inflation spike (4 5%) followed by slower growth and higher unemployment. Small tariffs mean a smaller inflation spike (around 3%). In both cases the Fed cuts interest rates. It's like being offered two flavors of existential dread. Either way the Fed's gonna step in probably with more band aids than actual solutions. "Order! There must be order before we descend into chaos!"

Transitory: The Word That Shall Not Be Named (Again)

Yes Waller actually used the T word. 'Transitory.' The word that haunted economists in 2021. He insists that despite the previous inflationary fiasco this time it’ll be different. He's basically saying "Trust me bro I know what I'm doing...this time." It's like telling someone you've got your life sorted out while simultaneously surrounded by empty energy drink cans and half finished self help books. But who am I to judge? We are all walking a tightrope between order and chaos my friends.

Trump's Tariffs: A Negotiating Ploy or Economic Revolution?

Waller suspects Trump's tariffs are either a negotiating tactic or an attempt to remake the economy. If it's the latter expect a sluggish economy and rising unemployment. If it's the former the impact on inflation will be smaller. Either way he admits that these tariffs are making forecasting and policymaking a nightmare. Sounds about right. It's like trying to navigate a moral landscape using the 'woke' mind virus as a compass: expect nothing but confusion and existential despair. Now clean your room. Metaphorically of course. And perhaps literally too!

Flexibility: The Art of Avoiding Responsibility

In the end Waller says the Fed needs to 'remain flexible.' Which in economist speak means 'we haven't got a clue what's going to happen so we're keeping our options open.' It's like telling your kids to be open minded about the future while secretly hoping they become responsible adults with stable jobs. Good luck with that. Now if you'll excuse me I have a lobster to wrestle with. There's a hierarchy to establish you know.