<<That’s a pretty definite statement that unemployment WILL rise. Once unemployment is higher (and presumably inflation is lower since that’s the objective) the pressure to raise wages will ease off.>>
Yup. As offered before, rising unemployment will enable wage and benefit rollbacks, and the rollbacks are expected to reel in inflation, by 1: reducing costs for the “JCs” and 2: reducing demand. Whether reducing costs for the “JCs” will “trickle down” to reduced retail prices, is another matter. I remember economists, for decades, talking about the difficulty of “pushing on a string”.
How do you square that with Bank of America’s recent adoption of $22/hr minimum wage? (North Carolina proudly maintains the state minimum at $7.25.) Clearly CEOs are feeling the heat on wages and job creation.
We’ll know in about 6 months whether you and Wendy are right. I wonder what Corporate America’s view is on a Hungary-style far rightward shift with Dickensian social policy? Is that good or bad for business going forward?
I’m already pricing out apartments in Barcelona just in case an evacuation is indicated.
intercst