The post-covid monetary hangover
When the Covid started, the Federal Reserve reduced interest rates to zero and increased the money supply unprecedentedly. It was a reckless policy whose consequences have been inflation of 7% in 2021, of 9.1% in the 12 months to June 2022 and it reached an annualized rate of 13% in the first half of 2022. The purpose of this note is to discuss how inflation could evolve after past mistakes and under current policies.