- In politics and economics, a Potemkin village is any construction (literal or figurative) whose sole purpose is to provide an external façade to lead the population to believe the country is faring better than reality.
- The Fed is now discussing reversing monetary policy (by hiking interest rates and reducing their balance sheet) to quell inflation.
- Not surprisingly, given that the current spike in inflation, and economic growth, was a function of massive liquidity infusions, the reversal will be deflationary.
For further details see:
Potemkin Economy: Costs And Consequences