Treasury Secretary Janet Yellen pushed back Tuesday at her predecessor Larry Summers over his recent comments that the Federal Reserve may need to consider hiking interest rates because inflation isn’t trending in the right direction.
“He’s a person who’s been wrong in the past,” Yellen said of Summers during a House Ways and Means Committee hearing. “He said that it would absolutely take a recession to bring inflation down, and that turned out to be a serious misjudgment.”
Actually, Yellen and Joe Biden practically proved Summers prophetic on inflation. Summers warned in February 2021 that Biden's massive stimulus bill (the 'American Rescue Plan') could spark runaway inflation, and that's exactly what happened. It took Biden and Yellen months before they admitted that inflation was neither "transitory" nor a short-term aspect of growth. For well over two years, the Bidenflation fire burned through the buying power of American households.
And it's not over yet, either. The rate of inflation may have decreased, but the impact hasn't -- and it's trending in the wrong direction again, as Summers predicted. Maybe Yellen should stop talking and start listening.
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