The Chairman of the Senate Committee on Banking, Housing and Urban Development, Sherrod Brown, sent a letter to federal reserve chair Jerome Powell, remind him of the central bank’s dual mandate and ask him not to forget his responsibilities promote maximum employment.
“For working Americans, who are already feeling the pressure of inflation, the loss of jobs will make it a lot worse. We cannot risk the livelihoods of millions of Americans who cannot afford it. I ask you not to forget your responsibility for promoting maximum employment and the decisions you make next FOMC Meetings reflect your commitment to the dual mandate,” Brown wrote in the letter.
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Fed meeting: The senator’s letter comes a week before the Federal Reserve is due to announce its monetary policy. The central bank is expected to hike interest rates by 75 basis points, but noted Market experts are increasingly expressing themselves their concerns about how the Federal Reserve has overdone its fight against inflation.
Stocks and bonds alike have been hit by the Fed’s actions and forecasts about its future policy stance. That SPDR S&P 500 ETF Trust SPY has lost over 19% since the beginning of 2022, while the vanguard Total Bond Market Index Fund ETF BND has lost over 16%.
Working class: Brown explained that a family’s “pocketbook” needs have little to do with interest rates, and potential job losses from overly tight monetary policy would only worsen the situation for the working class. He argued that higher-income households could better protect their wealth during economic downturns and take advantage of future wealth-building opportunities when the economy recovers, while lower-income families have fewer resources to mitigate unemployment and less wealth to invest during to accumulate assets and realize gains during a recovery .
“Because of this inequality, inflation and recessionary job losses are widening the gap between top and…
