Last April I said the Fed was on the verge of a policy mistake. My basic thinking on this was as follows: 1. Excesses in the financial markets and economy were obvious last May when I hinted that the Fed should be raising rates. 2. Inflation kept rising at an uncomfortable rate which warranted some Fed offset, but they remained behind the curve well into late 2021. 3. By the time the war in Ukraine was in motion the economy was already showing worrisome signs of slowing, but energy prices were surging. 4. All of this put upward pressure on inflation that forced the Fed’s hand to play “catch up” with the risk of ... (full story)