If the Fed actually executes this plan, the current bear market will have legs. If they don’t execute it, high inflation will have legs.
That was certainly the playbook after the 1973 Arab/Israeli war spiked fuel prices.
1974: CBs focus on inflation … stockmarket halved.
1975: CBs got cold feet and decided to accommodate fuel price inflation … stockmarket doubled.
I expect we won’t have to wait a full year and a halving of the stockmarket for another Powell Pivot, but we will get some more pain in the short term. October crash? Maybe earlier …