Powell has it dead wrong. Yes, inflation is 8.5% and interest rates are net negative (3-8.5 = 5.5%) underwater. The unemployment rate is 3.7% because less and less people are working. For example, if a targeted group of one hundred available workers finds that 90% are employed, the unemployment rate is 10%, but if ten of the unemployed workers retire they are no longer considered to be in the work force; therefore the unemployment rate is now 0%. We have a slippery slope here. Keep in mind there will always be shortage to some degree of demand  for workers with specialized skills.

Bringing a recession will not effect the unemployment rate, but will bring misery to the workforce. Pouring gasoline on the fire is not a solution, but will cause an unsurmountable problem. This is not palatable. Powell believes that cutting demand will bring inflation down. However, because of supply chain issues, which are slowly being resolved, oil price escalation due to limited supply issues brought upon us by Branden who shut down the Keystone pipeline in addition to suspending Gulf drilling.

There is only one way to resolve the INFLATION ISSUE, that is to let it run its course. Most people will cut back purchases, prices will drop until the X Y chart reaches equilibrium. 

GO FOR THE GOLD 

However, we add that the future scenario is precarious at best. The United States government owes thirty trillion dollars ($30,000,000,000,000,000) and counting. But overall obligations, including Social Security, Medicare and other off the book liabilities bring bring the total to one hundred thirty trillion dollars. This sham cannot go on forever. Something has to give.

https://www.usdebtclock.org/

Please note, the interest payed by the FED increases $30,000,000,000 (thirty billion) for every 1% increase in rates. This is not funny money; somebody has to pay up. You may ask when? Right now there is no answer, but dollar apocalypse is not too far away. When this happens, the dollar price of gold will go through the roof. Currently the dollar price of dollar is sinking due to the rise in interest rates. But in most all other currencies the price of gold has gone up.

There is never been a time in history when the Federal Reserve effectively reduced inflation without moving their key interest rates to at least equal to the current level of inflation. When inflation began to rise and was at 3% or 4%. The pandemic and recession in 2020 resulted in average inflationary pressures to come in at 1.2%. By 2021 inflation began in January at 1.4% and rose to 2.6% in March 2021. If the Federal Reserve acted and begun to raise rates and not maintain that inflation was transitory, it could have had a dramatic impact. Instead, the Federal Reserve did nothing. Had they acted at this point and began to slowly raise interest rates which had been set artificially low between 0 and ¼% they would’ve had a tremendous impact just by taking interest rates to 2%.

In April 2021 inflation was running at 4.2% in the Federal Reserve continued to do nothing and keep interest rates artificially low. By May 2021 inflation had risen to 5%, 5.4% in June and still the Federal Reserve did nothing. In fact, inflation rose to 6.2% in October, 6.8% in November, and 7% in December and still the Federal Reserve did nothing and kept interest rates artificially low at 02 ¼%.

By the time the Federal Reserve initiated its first interest rate hike in March 2022 inflation was already at 8 ½%. At this point, it would require the Federal Reserve to raise rates to at least 8% to have any sustainable impact to reduce inflation.

It is clear that the signs of rising inflation that occurred in 2021 showed a clear and systemic growth by the first quarter the point at which the Federal Reserve needed to act and did not. It was his primary misjudgment that inflation was transitory that led to the inaction of the Federal Reserve until it was too late.

Now the Federal Reserve is dealing with attempting to reduce and level of inflation and interest rate that cannot be supported for any sustainable period of time. With the national debt well over 120% of GDP if interest rates were raised today from 3% to 8% it would add $1.5 trillion per year to service our national debt. Clearly, the Federal Reserve has painted itself into the corner and by a critical mistake that led them to do nothing when they could’ve had a strong and immediate impact on inflation, instead, they sat on the sidelines and watched interest rates rise out of control.