A long time ago I published a column talking about when J. Powell mentioned Paul Volker to pay homage to his recent death. He was a previous Federal Reserve President from the 80's when there was a very high interest rate and very high inflationary environment. You can find the column at the bottom of this article.
I explained a possibility that Mr. Powell was being cryptic and hinting towards the fact that we might fall into another "Volker Era." During this era inflation was entrenched at very high levels and treasury yields and commodities prices were sky high as well, just like today. So far currently the economy is on that exact same path as the Volker Era. And with this past CPI data release it appears even more so.
If this current economic situation turns out to be like the Volker Era then things have a lot more room to get a lot more worse. Even though it is very unfortunate I find it a coincidence that Volker's death coincided with the potential start of the new Volker Era. I know what you are thinking. Crazy markets right?
So do you think the economy will fall into another "Volker Era?" If anybody knows why we will not fall into a Volker Era or how the past was different than the current situation then please let me know in the comments.
SpyderCall
OP456632345
:
totally forgot about the cold war. the russian conflict seems much worse but it still makes this current era more similar to the volker era than everybody else is thinking. I appreciate you pointing that out. just look at the charts for inflation and yields during the 80's. if today is anything like the past then we have a lot more upside in inflation and interest rate hikes
easygoing Lyon
456632345
:
we don't have to. ther e are more people trying to live in peace than those who want war. the meek may have to fight for there children. take the known crooks to jail!
456632345 : Hehe, we may be even worse today. At that time, it was just the Cold War, but now we are facing turbulence.
SpyderCall OP 456632345 : totally forgot about the cold war. the russian conflict seems much worse but it still makes this current era more similar to the volker era than everybody else is thinking. I appreciate you pointing that out.
just look at the charts for inflation and yields during the 80's. if today is anything like the past then we have a lot more upside in inflation and interest rate hikes
easygoing Lyon 456632345 : we don't have to. ther
e are more people trying to live in peace than those who want war. the meek may have to fight for there children. take the known crooks to jail!