There’s still a widespread labor shortage. A slowdown might mean significant unemployment in Silicon Valley, but it will mean a return to normal in most places.
Inflation is back to normal. It only looks high to people who are focused on lagging indicators such as the CPI.
I’d love to hear what specifically you disagree with. I don’t know of anyone who believes that inflation is back to normal. Can you cite anything to back that up? Also, I’d love to see any data supporting your contention that there is a wide spread labor shortage among the subset of the labor market I’m addressing. As an active VC, I haven’t seen evidence of that at all.
I see. Yeah, I don’t disagree that inflation is better, but it is certainly not a non-issue. Imagine what happens if the Fed dropped interest rates (rather than simply pausing them at the current rate). The point I was making relative to inflation is that the traditional playbook for responding to a contraction is difficult to picture given the macro environment. My guess is that even Kevin Erdmann would agree with that.
I disagree. The macro environment is good enough that the Fed could easily handle any contraction, provided they focus on forward looking indicators, such as the TIPS spread, or near-realtime indicators such as the ISM purchasing manager numbers.
Now seems like a good time for the Fed to start decreasing interest rates.
This is less than half correct.
There’s still a widespread labor shortage. A slowdown might mean significant unemployment in Silicon Valley, but it will mean a return to normal in most places.
Inflation is back to normal. It only looks high to people who are focused on lagging indicators such as the CPI.
I’d love to hear what specifically you disagree with. I don’t know of anyone who believes that inflation is back to normal. Can you cite anything to back that up? Also, I’d love to see any data supporting your contention that there is a wide spread labor shortage among the subset of the labor market I’m addressing. As an active VC, I haven’t seen evidence of that at all.
On inflation, see Kevin Erdmann (also here).
I see. Yeah, I don’t disagree that inflation is better, but it is certainly not a non-issue. Imagine what happens if the Fed dropped interest rates (rather than simply pausing them at the current rate). The point I was making relative to inflation is that the traditional playbook for responding to a contraction is difficult to picture given the macro environment. My guess is that even Kevin Erdmann would agree with that.
I disagree. The macro environment is good enough that the Fed could easily handle any contraction, provided they focus on forward looking indicators, such as the TIPS spread, or near-realtime indicators such as the ISM purchasing manager numbers.
Now seems like a good time for the Fed to start decreasing interest rates.