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Raising interest rates is like brewing traditional Chinese medicine; it's painfully bitter and might even exhaust the workers.
Powell's statement that "tight policy may impact the labor market" instantly made investors break into a cold sweat. Imagine the labor market like a pot of porridge, with the Federal Reserve adding water (easing) on one side and increasing the heat (tightening) on the other. If the heat is too strong, the porridge will dry out; if the heat is too low, inflation will boil over. The current problem is: the bottom of the pot is about to burn.
The logic of
View OriginalRaising interest rates is like brewing traditional Chinese medicine; it's painfully bitter and might even exhaust the workers.
Powell's statement that "tight policy may impact the labor market" instantly made investors break into a cold sweat. Imagine the labor market like a pot of porridge, with the Federal Reserve adding water (easing) on one side and increasing the heat (tightening) on the other. If the heat is too strong, the porridge will dry out; if the heat is too low, inflation will boil over. The current problem is: the bottom of the pot is about to burn.
The logic of