In 1979 President Jimmy Carter was faced with rising inflation accompanied by soaring house prices, an oil shock triggered by the Iranian Revolution, the Russian invasion of Afghanistan, and a suddenly hawkish Federal Reserve under its new chair, Paul Volcker. If this sounds all too familiar, it should.
Today we find President Joe Biden faced with rising
inflation accompanied by soaring house prices, an oil price shock, the Russian
invasion of Ukraine and a newly hawkish Federal Reserve. It certainly seems
like that history is yet again, if not repeating, certainly rhyming. In early
2021 we wrote about the potential for the 2020’s to be a rerun of “That 70’s Show.”
( See: Shulmaven: Roaring 20's or That 70's Show ) Moreover
Biden seems to be copying Carter’s energy policy incoherence by supporting
policies that will simultaneously increase demand and reduce supply. Thus,
instead of roaring, the 2020’s are looking more and more like the stagflation
of the 1970’s.
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