When does sympathy become annoyance?

I have the greatest sympathy for investors suffering from inflation derangement syndrome. Young investors in particular seem to view inflation as cancer, Covid, and venereal disease at the same time. Inflation is bad enough without the hysteria!

All that’s understandable, I guess, but what is annoying is this – why the assumption that we are helpless to fight inflation? Has there ever been a bout with inflation that we did not kill?

Imagine a concrete wall that is six inches thick . . . no, make that twelve inches thick. Give me my trusty old 50-caliber machine gun, and I will easily remove that 6″ wall. Give me a little more time, and I will remove the thicker wall as well.

Just as surely as concrete cannot stand up to 50-caliber ammo, inflation cannot stand up to higher interest rates. No matter how high inflation is, interest rates can go higher. Stop worrying about whether we can kill inflation. There is no economic mystery to that.

However, the mystery is how close to the economic edge are we are willing to skate. Higher interest rates push us closer and closer to the economic edge. Today, there is no discussion of raising rates, only lowering rates.

We know how to curb inflation. We can only argue how quickly to do it.

I am relieved that Congress is relatively removed from monetary decision-making. Let the Fed do it – some things are just too important for elected leaders . . .