There’s a constant notion that if the economy does well, the middle class will restore itself. That is not true. What happens over time in all economic history is that the wealthy weaponize government, lower taxes on them, resist competition — the biggest, most powerful companies entrench themselves, and you end up with an erosion of the middle class. You end up with income inequality. It gets worse and worse, and then the same thing happens with income inequality. The good news is income inequality, when it gets to these levels, always self-corrects. The bad news is that the mechanisms for self-correction are war, famine and revolution.
I think we’re closing in on the “war, famine and revolution” stage of the 40-year economic cycle. And the idea that we’re going to throw 10 million people out of work to “fix inflation” will be the trigger.
Where is this number coming from? The article is behind a paywall.
The Fed is predicting that unemployment will increase from 3.7% to 4% by 2024. An increase of .3 to .4% on an employed number of 158 million; that would be about 650,000 additional unemployed, not 10 million.
An increase in 10 million unemployed would increase unemployment to about 9.7%.
I am of the opinion that the fed would stop increasing rates if we started to see unemployment climb anywhere close to that high - as they have in the past when unemployment spiked (2009 and 2020).
And the idea that we’re going to throw 10 million people out of work
The Fed will back off QUICKLY long before 10M people become unemployed. Heck I think they would lose their rate-hiking fever if even 3M become unemployed.