Happy Thursday, Blockfolians
In a much anticipated speech for the annual (though this year virtual) Jackson Hole conference held by the Kansas City Fed, Fed Chair Jerome Powell articulated a new policy framework centered around a new approach to inflation:
Forty years ago, the biggest problem our economy faced was high and rising inflation. Today, the persistent undershoot of inflation from our 2 percent longer-run objective is a cause for concern.
The change, in short, is that rather than targeting a 2% inflation rate specifically, the Fed is now looking for an average inflation rate of 2%. That means that if there has been an extended period below that number (such as we’ve experienced over the last ten years), the Fed would be looking to actively go over 2% inflation to counter balance.
The takes came hot and fast:
ShapeShift’s Erik Vorhees summed up the feelings of a lot of bitcoiners:
It’s hard not to feel like the tectonic plates that underpin our financial system are changing. The question is simply: what happens next?
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In memes we trust.