You Blew It, Janet

Amanda Heckman|June 4, 2022

Dear Ms. Yellen,

Or… Janet? Can we call you Janet?

Nice try.

We see you, Janet… out there making the rounds on the White House apology tour… showing up on CNN, admitting you got it wrong… sort of.

“I think I was wrong then about the path that inflation would take,” you told Wolf Blitzer this week.

You think?

In 2021, you said inflation posed only a “small risk.” And now? Well… here we are.

Wolf was right to call you out. But then you revealed your ignorance in full, admitting there have been “unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that [you] didn’t… fully understand.”

Gee, thanks for owning up to your extremely shortsighted thinking. Too bad it’s too little… and waaay too late.

Your legacy (and Jay Powell’s) is set. No amount of backpedaling or apologizing will change it. History will remember that you oversaw the most disastrous loose-money policy in American history.

In just two months in 2020, the U.S. printed more money than it had in all of the previous 200 years.

Then you came on board in 2021… and encouraged even more printing. (See also: the American Rescue Plan and the Build Back Better Plan.)

We printed so much money that governments and businesses around the country are still sitting on piles of cash they don’t know what to do with.

And we kept printing, even though we were facing historic supply chain issues.

We’ve been warning about the inevitable disaster for years. Heck, Andy even wrote to you back in 2016 when you were the Fed Chair, warning about the dangers of free money thanks to zero percent interest rates.

But, Janet, it’s not just us who see disaster. Plenty of other voices have now joined the chorus.

A Conference Board survey last month of 133 CEOs of mostly public companies had unsurprising (to us) results. A full 68% expect that inflation will trigger a recession. Sixty-one percent reported that economic conditions have worsened over the past six months, and just as many expect conditions to continue declining.

And this week, the leader of the nation’s biggest bank began singing in tune with us.

JPMorgan Chase’s Jamie Dimon warned that folks better brace themselves for an economic “hurricane,” adding, it’s “right out there down the road, coming our way.”

He thinks things are so bad that people will be “writing about [this] in history books for 50 years.”

So what now, Janet? Will you and Jay fully own up to your mistakes… and make the tough choice we need you to make?

Will you get out of the way… let a recession cool inflation and slow the economy down… and let short-term pain bring us long-term gain?

Or will you continue to make the same mistakes… artificially propping up the economy… kicking the disaster can down the road again… and leaving an even bigger mess for the next guy?

Your move, Janet.