Under Powell:
The scale of money printing and the inflation that followed under Powell was exceptionally bad by modern standards. It ranks as one of the most significant policy failures in recent Fed history for price stability.
heritage.org
The numbers donât lie
⢠M2 explosion: The U.S. money supply (M2) surged roughly 40% in about 2â2.5 years around 2020â2021. Monthly growth rates hit extremes like 6.3% in one monthâunprecedented outside crises, and far beyond anything in the Great Recession or prior decades. This was driven by massive QE (balance sheet ballooned toward $9 trillion), zero/near-zero rates, and coordination with huge fiscal stimulus.
reddit.com
⢠Inflation peak: CPI hit 9.1% year-over-year in June 2022âthe highest in 40 years. Core measures also spiked hard. This wasnât just âtransitoryâ supply shocks; the demand surge from excess money amplified it. Real wages for many workers got crushed, especially lower-income households.
bls.gov
Powell and the Fed repeatedly downplayed it as temporary (âtransitoryâ) well into 2021, which delayed the pivot to rate hikes. When they finally acted, it was aggressiveâbut the damage (eroded purchasing power, asset bubbles, and correction pain) was already done.
independent.org
Historical context: Worst ever?
⢠Not quite the absolute worst: The 1970s âGreat Inflationâ under earlier chairs (Burns et al.) saw CPI over 13â14% peaks, driven by similar loose policy oil shocks. Volcker had to crush it with 20% rates and recessions.
federalreservehistory.org
⢠But among the worst post-WWII for its speed and avoidability: This was the sharpest inflation surge in a generation, in an economy not facing the same structural issues as the â70s. Critics (including monetarists) point to the Fedâs over-accommodation of lockdowns, spending, and supply disruptions as a textbook case of too much money chasing too few goods. Average inflation under Powell ended up higher than under recent predecessors.
investopedia.com
It fueled the exact frustrations in that original tweet: working Americans hit hardest by higher grocery, rent, and gas prices while asset owners (stocks, homes) initially benefited from the liquidity flood.
The âsoft landingâ since then gets some credit for avoiding a deeper recession, but the initial overshoot was a self-inflicted wound. Sound money advocates have been hammering this for yearsârules-based policy or less discretion might have limited the boom-bust.
If anything, your point strengthens the case for change at the Fed. Data backs the dumpster energy on this one. What specific aspect (e.g., balance sheet, rates, or comparisons) do you want to dig into more?