My friend Jared Bernstein calls our attention to the rebirth of the inflation hawks. Apparently, there is a new craze among economists to say that we are in a period of structurally higher inflation. The basis for this is that we are looking at consistently higher inflation in the 20s than we saw in the quarter-century from 1995 to 2020. So, the question is whether there is a structural break or just a series of bad breaks for the economy and the country.

Put me firmly in the series of bad breaks camp. First, the bad breaks were not exactly a secret. The pandemic disrupted economies throughout the world. When people could no longer spend money on services like restaurants, gyms, and travel, we saw a massive shift in demand to goods like cars, refrigerators, and clothes. The world economy could not quickly shift production to keep up, so we got inflation.

There’s nothing surprising there. Also, the inflation lasted longer than I and my Team Transitory teammates........

© Eurasia Review