Is that 2% inflation target feasible longterm?
10/20/2023 •
No — The majority of the comments indicate skepticism about the feasibility of the 2% inflation target, with historical data often suggesting average inflation rates closer to 2.5-4%. Many see the 2% target as arbitrary and made up. There's also a prevailing sentiment for flexibility and adjustment based on changing economic conditions.
Stats
| 82% | 94 | |
| 8% | 9 | Hacker News |
| 5% | 6 | Bluesky |
| 5% | 6 | Mastodon |
| 57% | Negative |
| 32% | Neutral |
| 11% | Positive |
| 52% | 😡 Anger |
| 26% | 😃 Joy |
| 18% | 😱 Fear |
| 3% | 😢 Sadness |
| 1% | 😯 Surprise |
| 0% | 🥰 Love |
😡
😃
😱
Story
- Commenters debate the feasibility of the 2% inflation target in the long term, with some supporting it and others proposing higher targets or alternative approaches.
- Historical data has been cited by some commenters to suggest that inflation rates have been closer to 2.5-4% rather than the 2% target.
- Some argue that a short-term deflationary approach can help cool off high inflation and make the 2% target more manageable.
- Commenters emphasize the importance of maintaining a low but positive inflation rate to incentivize spending, increase liquidity in the market, and boost productivity.
- There are calls to raise the inflation target to 3% or 4%, citing various reasons such as preventing stagnation like Japan's and reflecting current economic conditions better.
- Concerns have been raised about potential economic dangers and external pressures impacting the achievement of the 2% target, such as risks associated with deflation or excessive investment.
- A number of commenters see the 2% target as arbitrary and believe that economic growth can occur without any inflation.
- Some commenters suggest that the Federal Reserve may prioritize other objectives over the 2% inflation target, such as financing government debt or preventing a financial crisis.
- There is skepticism about the Federal Reserve's ability to achieve the 2% target, especially considering potential risks of hyperinflation or currency collapse.
- Some commenters emphasize trusting financial analysts and experts who suggest one more rate hike is possible before aiming for a long-term return to 2%.