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Home / Alhambra Investment Partners / Eurodollar University’s Making Sense; Episode 122, Part 3: The Making Of Fed Mistakes, Volcker’s Enduring Myth

Eurodollar University’s Making Sense; Episode 122, Part 3: The Making Of Fed Mistakes, Volcker’s Enduring Myth

Summary:
122.3 1970s stagflation? No! But NOT why you think…———Ep 122.3 Summary———“Despite some eerie echoes, the past is not the best guide to the present,” writes The Economist. Jeff Snider agrees, but for entirely different reasons. Stagnation? Yes, definitely. But NOT inflation – despite the clear price increases! Wait, what?———Sponsor———Macropiece Theater with Alistair Cooke (i.e. Emil Kalinowski) reading the latest essays, blog posts, speeches and excerpts from economics, geopolitics and more. Interesting people write interesting things, why not listen and hear what they have to say? You could do worse things with your time (i.e. Bloomberg, CNBC, et cetera). Recent readings include thoughts from George Friedman, Lyn Alden, Daniel Oliver, Michael Pettis, the Bank for International

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122.3 1970s stagflation? No! But NOT why you think…

———Ep 122.3 Summary———
“Despite some eerie echoes, the past is not the best guide to the present,” writes The Economist. Jeff Snider agrees, but for entirely different reasons. Stagnation? Yes, definitely. But NOT inflation – despite the clear price increases! Wait, what?


———Sponsor———
Macropiece Theater with Alistair Cooke (i.e. Emil Kalinowski) reading the latest essays, blog posts, speeches and excerpts from economics, geopolitics and more. Interesting people write interesting things, why not listen and hear what they have to say? You could do worse things with your time (i.e. Bloomberg, CNBC, et cetera). Recent readings include thoughts from George Friedman, Lyn Alden, Daniel Oliver, Michael Pettis, the Bank for International Settlements and yes, even Karl Marx.

———See It———

Twitter: https://twitter.com/JeffSnider_AIP
Twitter: https://twitter.com/EmilKalinowski
Alhambra YouTube: https://bit.ly/2Xp3roy
Emil YouTube: https://bit.ly/310yisL
Art: https://davidparkins.com/

———Hear It———

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PodcastAddict: https://bit.ly/2V39Xjr

———Ep 122.3 Topics———

00:00 INTRO: The Economist says well-known economists worry about 1970s-style stagflation.
00:36 Summers, Rogoff and El Erian warn of inflation – they did before.
02:13 Inflation versus price increase, what’s the difference?
04:54 Stagflation in 2021? Economic activity is slowing and prices remain high.
07:03 Like the 1970s, the world is experiencing commodity (energy, food) price shocks.
07:48 Like the 1970s, central bankers will prioritize employment over inflation control.
12:15 Like the 1970s, governments will blow their budgets with extreme spending.
13:48 The Economist does not agree the 2020s will resemble the stagflationary 1970s.
14:12 Unlike the 1970s, rising prices will not be reflected in rising wages.
17:01 Unlike the 1970s, productivity will rise (because there are fewer employed?!).
22:37 Unlike the 1970s, central bankers are competent and inflation-focused.
24:14 Jeff explains “The Paul Volker Myth”.
29:09 OUTRO: Stagnation? Yes. Inflation? No.

———Ep 122.3 References———

Is the world economy going back to the 1970s?: https://econ.st/3BmDat5
Alhambra Investments Blog: https://bit.ly/2VIC2wWlin
RealClear Markets Essays: https://bit.ly/38tL5a7

———Who———

Jeff Snider, Head of Global Investment Research for Alhambra Investments and Emil Kalinowski. Art by David Parkins, myth spinner. Podcast intro/outro is “Knight’s Templar” by Adriel Fair found at Epidemic Sound.

 


Jeffrey P. Snider
As Head of Global Investment Research for Alhambra Investment Partners, Jeff spearheads the investment research efforts while providing close contact to Alhambra’s client base. His company is a global investment adviser, hence potential Swiss clients should not hesitate to contact AIP

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