> a year or two ago

3 years ago. September 2022. https://edition.cnn.com/2022/09/23/economy/powell-fed-labor-...

When unemployment rates were back down to the pre-covid 2020 levels, only time they were even lower was before the 1969 recession. When inflation was at the highest it's been since the 80s.

The statement & monetary policy decision was entirely appropriate at the time.

Thanks!

I actually tried a brief search to get a more accurate time, but all the results were skewed heavily to the last few months so I gave up. I'm impressed you found it.

That's the inherent nature of the interest rate. Both unemployment and inflation have bad consequences, so the role of the central bank is to balance rates to target a specific inflation rate.

and inflation can continue forever! no problems with that at all, the economy is definitely built on money and not a finite supply of resources constrained by entropy.

I actually don't see a problem with that because what is useful information in a price system is the relative price of things, not the absolute price, which is arbitrary.

Powell doesn't decide or control the unemployment rate. His job is simply to react to it.

Yes lets blame Powell he pushed Trump into putting tariffs on everything and gutted the remaining manufacturing jobs.

And either way, voters around the world have made it extremely clear that price inflation annoys them more than high unemployment. So if Powell's options are to cause unemployment or allow continued inflation, I can see why he'd pick the former.

Isn’t that the charge of the federal reserve? I think this is what he is required to do statutorily.

An astute and accurate observation. However, there is no numeric target set in the mandate you allude to: "The Federal Reserve was created by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. In 1977, Congress amended the Federal Reserve Act (FRA) to provide greater clarity about the goals of monetary policy. The amended FRA directs the Board of Governors and the FOMC to conduct monetary policy “so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.” [https://www.federalreserve.gov/aboutthefed/files/the-fed-exp...]

What he is doing is counter to the Fed charter, but if you're pro-Capital, you like some unemployment because it disciplines Labor.

> The chair's main responsibility is to carry out the mandate of the Fed, which is to promote the goals of maximum employment, stable prices, and moderate long-term interest rates.

(per Investopedia https://www.investopedia.com/articles/investing/082415/what-...)

> The chair's main responsibility is to carry out the mandate of the Fed, which is to promote the goals of maximum employment, stable prices, and moderate long-term interest rates

You’re correctly quoting your source. But this is crap, as their source [1] makes no reference to “moderate long-term interest rates”.

The Fed is mandated to promote “maximum employment” and “stable prices” [2]. (It defines the former as “the highest level of employment or lowest level of unemployment that the economy can sustain while maintaining a stable inflation rate.”) If inflation is unstable, the economy is above maximum employment.

[1] https://www.federalreserve.gov/paymentsystems/coin_about.htm

[2] https://www.federalreserve.gov/aboutthefed/fedexplained/mone...

Isn't the idea that maximum employment, stable prices, and moderate long-term interest rates are somewhat in tension with each other though? Which would mean the mandate is to balance those three things – e.g. maximize employment to the extent possible while maintaining stable prices and moderate interest rates.

> Powell said explicitly a year or two ago that it was his goal to bump unemployment numbers to tame inflation. Kinda sick to think about, but, here we are I guess.

This is basic monetary economics via the Phillips curve (https://en.wikipedia.org/wiki/Phillips_curve). There's a strong relationship between unemployment rate and the inflation rate. Of course, that is based on historical data in normal times, and, since 2010s and the financial crisis with years of ZIRP, we are now in very unnormal times with Trump's tariffs and general fuckery of the economic system.