2024-10-21
58 分钟Joseph Gagnon is a senior fellow at the Peterson Institute for International Economics, a former senior Fed staffer, and a returning guest to the podcast. Joe rejoins David on Macro Musings to talk about the unholy trinity behind the COVID inflation surge and what history can teach us about the unusual inflation experience of that period. David and Joe also discuss the inflationary lessons from the Korean War, the Fed’s upcoming framework review, and much more. Transcript for this week’s episode. Joseph’s Twitter: @GagnonMacro Joseph’s PIIE profile David Beckworth’s Twitter: @DavidBeckworth Follow us on Twitter: @Macro_Musings Check out our new AI chatbot: the Macro Musebot! Join the new Macro Musings Discord server! Join the Macro Musings mailing list! Check out our Macro Musings merch! Related Links: *What Caused the U.S. Pandemic-Era Inflation?* by Ben Bernanke and Olivier Blanchard *Understanding U.S. Inflation During the COVID Era* by Laurence Ball, Daniel Leigh, and Prachi Mishra Timestamps: (00:00:00) – Intro (00:02:46) – Predicting the Post-Pandemic Inflation Surge (00:06:39) – Assessing the State of the Bond Market and Inflation Expectations After the Inflation Surge (00:16:14) – What Caused the U.S. Pandemic-Era Inflation: Breaking Down the Literature (00:23:45) – *The Trinity of COVID-Era Inflation in G7 Economies* (00:32:55) – *Why Did Inflation Rise and Fall So Rapidly? Lessons from the Korean War* (00:42:06) – Inflation, FAIT, and the Upcoming Fed Framework Review (00:49:18) – Why Should the Fed Consider Nominal GDP Targeting? (00:53:04) – Responding to the Measurement Issue Surrounding Nominal GDP (00:57:40) – Outro
Welcome to Macro Musings, where each week we pull back the curtain and take a closer look at the most important macroeconomic issues of the past, present, and future.
I am your host, David Beckwourth, a senior research fellow at the Mercatus center at George Mason University, and I'm glad you decided to join us.
Our guest today is Joe Gagnon.
Joe is a senior fellow at the Peterson Institute for International Economics, a former senior Fed staffer, and a returning guest to the podcast.
Joe joins us today to discuss the unholy trinity behind the COVID inflation surge and what history can teach us about the unusual inflation experience of that time.
Joe, welcome back to the program.
David, it's good to be here.
It's great to have you on.
And before we get to this unholy trinity, which sounds very scary, and those are my words, not yours, behind the inflation surge, I want to sit back and maybe take stock of what we've been through the past four years.
We had a deep recession, the COVID recession.
Then we had this inflation surge.
Man, it seems like we're on the other side of that now.
Just this past week, we had a really good PCE inflation report.
It's almost like mission accomplished.
Let me begin with that.
Is it mission accomplished or is it too soon to declare it?
I don't know if you can ever fully declare it because there could always be a surprise around the corner.
But, gee, it seems to me the Fed, it's got to be happy with where things are.
It's turned out about as well as could have been expected.
A couple of years ago, I thought a recession was not inevitable, but likely, more likely than not, and we've definitely avoided that.