Jerome Powell's Inflation Speech Sinks Stocks and Could Hurt Economy

Jerome Powell's speech on inflation last week had a negative impact on the stock market. It could also have a negative impact on the economy.

Jerome Powell's speech on inflation and interest rates was a body blow to the stock market, as it signaled a tough road ahead for the economy. While Powell admitted that fighting inflation will slow the economy and cause pain, he said it was a necessary battle. This news is sure to add more uncertainty to an already volatile market.

Powell's prescription for inflation is profoundly wrong. Austerity is not the cure; stabilizing the value of the dollar is.

Powell has fundamentally misread the lessons of the seemingly intractable inflation of the 1970s, and this is likely to have negative consequences for the economy in the future.

We are in for totally unnecessary turbulence, sadly reflecting mainstream economic thinking according to Powell's views.