What Jerome Powell just Said (Quick Summary).

hey everyone me kevin here in case

you're wondering what happened with

jerome powell

and front of congress and his testimony

today the answer is

well in this video so here's the thing

jerome powell remind us

reminded us that a significant portion

or all inflation that we are seeing now

is due to temporary

base effects and supply bottlenecks he

mentioned a significant portion

to all of it now he declined to give us

a specific percentage

he says that he quote has a level of

confidence

in the prediction that that inflation is

transitory but he did not give us

an amount he also mentioned that the

jobs are likely to lag

as when people change change jobs they

have to learn new skills or present

themselves and sell their skills in

different ways and this makes it

difficult for them to quickly get new

jobs he sees this

potential match-up issue to to getting a

job or like the way i like to depict it

is

you've got a bunch of neatly placed

marbles on a marble set and some child

or whatever comes in throws them all up

into the sky and then and then they all

have to get resorted right

jerome powell sees the reassignment of

people the reassignment of the marble so

to speak

as being or running against the speed

limiter match-up issues because of

differences in skills

in education but he does also say that

beyond this speed limit issue

we do have the issue that people aren't

potentially getting jobs right now as

they

some of them are potentially still

afraid of covid especially communities

that are less likely to get vaccinated

like african americans

or hispanics who also disproportionately

work in the service industry

or which which was obviously one of the

most uh hard hit or actually probably

the most hard-hit

sector during the economy we also know

that schools are still closed which is

keeping folks home taking care of their

children

and that unemployment benefits might

also be weighing

on folks uh interest in going back to

work now jerome powell does tell us

that hey this this was a pretty funny

moment uh during the actual

uh testimony jerome powell gets asked

hey well wait a minute jerome powell

so you're saying it's good if we get rid

of the unemployment boost or that the

unemployment boost expires

because that means people might be

motivated to go back to work

and then the questioner of a congress

person

questions and says so doesn't that mean

that it would be

bad if democrats extend the unemployment

boost

and as soon as he said that he's kind of

just like he went super quiet like not

touching that

uh but it was it was interesting the the

big bottom line takeaway

short of sort of trying to reenact what

happened there the big bottom line was

jerome powell said hey look i expect

people to go back

to work in september so he almost got

caught in the corner

walked himself out by saying i expect

people to go back to work in september

that's all he said it also mentions that

rising income inequality hurts

productivity

and uh hurting productivity is obviously

a bad thing that we want to make our

society more productive

touched a little bit on yes

infrastructure spending is generally

deemed to be good for productivity

but the level of our spending right now

is unsustainable he reiterated and he

said this before so it's not news

he said quote we are on an unsustainable

path

and he's referring to the debt in the

united states that we have no issues

paying our debts now because interest

rates are low

we probably won't have issues paying our

debt in the future even if interest

rates go up

he does not expect the united states at

any point to ever have difficulties

paying its bills

but he does say that we are spending too

much money right now to where

we are on an unsustainable path so he

really gave nuggets to both democrats

and republicans in their negotiations

when he was asked can we get to 1970

style

inflation he says quote very

very unlikely he also mentions and made

this very clear that the business of

taxing

is not the business of the fed and

multiple times throughout his testimony

he made it very clear that certain

things were quote

not my job and that is a summary of what

jerome powell had to say during it