Oddbean new post about login | logout Meeting with a group of private economists, President Reagan said he believes the high interest rates that jeopardize the success of his economic policy will be declining "in the not too distant" future. https://i.nostr.build/0XC40j7DmLyy0Mkh.jpg
Of course it would. The dollar lost its last peg to gold in the early 70s, and inflation went double digit (Arab oil embargoes didn’t help either). Once Volcker slayed the inflation beast, rates had to come down. The monetary system was pure fiat now, and as such it demands growth at all costs. Deflation for too long would cause the entire system to implode.
