They put the lotion on their skin

There is something very sick and twisted about the way the Federal Reserve thinks. Last year at this time, there was a flood of job postings from LinkedIn and Indeed to my inbox everyday. It was the result of the Great Resignation. The older baby boomers are leaving for Valinor and the rest of us have to pick up the slack. Or the pandemic forced a lot of women out of the job market to become full time caretakers for their children (because you don’t really expect more men to do that, do you?). Or millennials and Gen Xers had a “what’s it all about, Alfie?” moment and decided they would like to avoid more burnout, thank you very much.

All of these various causes meant that for once in my life, the job freezes came off and suddenly there was an embarrassment of riches plus wage increases. We were finally *worth* something. It has changed recently. There are still a lot of job postings but it’s more like a nicely flowing river after historic drought decades and not like the raging torrent it was last year. I’m seeing about 70 postings per day to my inbox this year for my job title settings, down from over 100 per day last year.

Ok, all of this roughly coincided with inflation. But let’s think about that for a second. We had an oil crisis. Is anyone studying the phenomenon where all of the oil producers suddenly need to shut down their refineries for maintenance the second a Democratic president takes office? Or what about Russia invading Ukraine, exacerbating the oil crisis through sanctions. Or the supply chain crisis caused by Covid, meaning some goods are scarce, driving costs up like classic textbook microeconomics predict. Or egg producers and other businesses hiking prices waaaaay above the rise in inflation to take advantage of, well, us? Or it was the stimulus of packages during Covid flooding the market with money that ordinary unemployed Americans used for basic goods and services. Or tarriffs that Trump conveniently put on little things like lumber, solar panels, baby formula and a myriad of other items that caused shortages and price spikes that got passed on to consumers.

You know what I *don’t* blame too much for inflation? Workers demanding more money. Yes, it costs more to eat out. See cost of everything going up because of the stranglehold on oil. But I don’t blame them because the Great Resignation caused a shortage. Yes, that means as “goods” we are more expensive. But since there are fewer of us, there are fewer of us to pay a salary and benefits as well. That would suggest that it might be more of a zero sum thing.

But what does the Federal Reserve start doing the minute they smell inflation in the water even if they know it’s mostly temporary? They slam the brakes on the economy by raising interest rates. Inflation is the siren song of the investment class. There is absolutely nothing worse even if it’s going to get better soon.

There’s also something cold and heartless about the interest rate hikes. If you’ve been paying attention to what the end goal is, it has something to do with deliberately engineering a recession. Here’s a little refresher from the Washington Post:

“If they raise rates next week, I would be absolutely speechless,” said Joseph LaVorgna, chief economist at SMBC Nikko Securities America. “Just last week the Fed was alluding to have to raise rates even higher, but this is a whole new situation. SVB is exacerbating what had already been a looming problem: The Fed was singularly focused on inflation, not recognizing that it would be prudent to sit and wait and see how things evolve.”

The likely U-turn comes less than a week after Fed Chair Jerome H. Powell told Congress he “would be prepared to increase the pace of rate hikes” if the job market and other parts of the economy remained resilient.

Ah, yes, the problem isn’t really inflation. It’s that the economy remains resilient, which most of us who work for a living find is a good thing. Well, we can’t have that. Someone is going to have to regulate inflation (that we all recognize is mostly temporary) and it will need to be wage earners. My nervous system hasn’t recovered from the Great Recession yet. Neither has my financial situation. I have yet to see these fabulous wage increases. I’m probably going to die over a hot keyboard instead of on a nice sandy beach after an afternoon of pickle ball.

The last thing we want is for the economy to remain resilient. It’s much better for wage earners to get freaked out by layoffs and to see all their minimal gains get wiped out by psychopathic federal reservists deciding that even those slight gains are making the investment class cranky. Also, they still haven’t been able to get rid of social security and Medicare and they weren’t even born when someone strapped them into lifelong obligations on that front. I’m getting the distinct impression that they don’t really see us as human beings.

But they sure do shriek like banshees when one of their toy banks go under through their own bad management and libertarian serial killers taking all their money out at the same time. (Maybe that kind of free speech should be monitored on social media as much as the domestic violent extremism) If they shriek loudly enough and scare everyone else, the government, ie we, will bail them out.

We are going to get the hose again.

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