Biden shouted! It is now necessary for the Fed to adjust its monetary policy appropriately to fight inflation

On Wednesday, January 19, Eastern time, US President Joe Biden called out to the Federal Reserve at a White House press conference, saying that it is now necessary to adjust its supportive policies appropriately in order to fight inflation.

Controlling rising prices is a vital job of the Fed. Support the independence of the Federal Reserve (in setting monetary policy).

Biden believes inflation is closely linked to supply chains, saying the administration has made progress in accelerating access to raw materials and that it is appropriate for the Fed to readjust its support for the U.S. economy given the pace of rising prices and economic recovery.

Given the strength of our economy and the recent price increases, this is appropriate because Fed Chairman Jerome Powell has said that readjustment is now necessary for support (monetary policy).

U.S. CPI rose 7.0% year-on-year in December, accelerating again, the last time it was so high in June 1982. As the Wall Street Insights previous article analyzed, the same high inflation, today's 7% is very different from 1982. On the one hand, inflation is still rising, and the CPI has begun to decline in 1982; on the other hand, monetary policy in 1982 and now is also completely different, the current Fed buys a large number of bonds to suppress long-term interest rates, the money supply has increased sharply, and the federal funds rate is close to zero.

The adjustment of the Fed's monetary policy is imperative and just around the corner.

Not long ago, Powell promised the American people that it would become entrenched in avoiding high inflation; Brainard said that letting excessively high U.S. inflation slow down was the Fed's most important task, and its priority was to protect economic growth, help recovery, and support monetary policy that responded to many (financial) conditions. Subsequently, a growing number of Fed officials predicted that the "door to tightening" would be opened this year with more than three rate hikes.

In addition to calling out to the Fed to control prices, Biden said Capitol Hill should confirm Powell's re-election as Fed chairman without delay. At the same time, he also called on the U.S. Senate to confirm his recent nomination for key positions on the Federal Reserve Board:

There is no further delay.

In November last year, the Biden administration officially nominated Powell for re-election as Fed chairman, and also nominated Fed Governor Brainard to be promoted to vice chairman of the Fed. In January, Powell and Brainard attended their re-election hearings and nomination hearings, waiting for lawmakers to vote. Biden's shouts indicate that Powell will be officially confirmed as the next Fed chairman.

In addition, wall street news earlier article mentioned that US President Biden has appointed Raskin Sarah Bloom Raskin as the Federal Reserve's vice chairman responsible for banking supervision - the top regulatory official in the banking industry. Biden is also about to appoint Cook Lisa Cook and Jefferson Philip Jefferson to fill the remaining two vacant seats. At this point, the three new members of the Fed's board of governors may become its first full member in many years.

Finally, Biden also said that the United States will not follow the old road of blockade in the prevention and control of the new crown pneumonia epidemic.

The United States needs to contain the COVID-19 pandemic.

On Wednesday, the White House said in a statement that to control the spread of the coronavirus, the U.S. government has provided 400 million non-medical surgical N95 masks to the public free of charge from its national strategic reserve. This is the largest deployment of personal defense equipment in U.S. history. Previously, the United States launched a website for the public to obtain free home test kits for the new crown virus, and one home address can receive 4 copies of home tests.

Yesterday, the number of new cases in the United States was 1.1 million, and the average seven-day hospitalization of confirmed and suspected COVID-19 patients in the United States reached the highest level on record at the end of last week, with about 155,958 cases reported on Sunday.

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