CPI - Former Fed Economist Claudia Sahm Credits American Workers Fiscal Policy For A Soft Landing In 2024 But Praises Powell For Not Crashing | Benzinga
In a series of tweets on Thursday, former Federal Reserve economist Claudia Sahm shared her insights on the potential for a soft landing in 2024, crediting Federal Reserve Chair Jerome Powell for this outcome. Using a flight simulator image of Everest base camp’s Lukla airport, Sahm illustrated her point, emphasizing the role of American workers and fiscal policy over the Federal Reserve’s actions.
What Happened: Sahm’s aeronautical-themed posts on X, formerly Twitter, outlined a comprehensive view of the Federal Reserve’s role in the recent economic cycle. She acknowledged that while Powell agrees with the prospect of a soft landing in 2024, the Fed was not the main driver behind the fluctuations in inflation and jobs.
We can all see the runway, Jay Powell agrees. Soft landing is in the bag in 2024. — Claudia Sahm (@Claudia_Sahm) December 14, 2023
But make no mistake, Jay is not the pilot. This wild ride in inflation and jobs had little to do with the Fed. pic.twitter.com/N9oxKmbwXe
Sahm described the Fed’s actions as an updraft in 2020, a tailwind in 2021, a headwind in 2022-23, and a calming presence in 2024. However, she stressed that the primary factors influencing the economy were fiscal policies and the resilience of American workers.
What did the Fed do?
– Updraft in 2020 ...