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The Fed Announces Two Big Changes for 2022

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Interest hikes are coming as inflation soars

Inflation is at a 39-year high and it appears not to be transitory. As a result, last Wednesday the Federal Reserve announced last Wednesday they will reduce their bond purchases twice a fast as previously planned and plans on raising interest rates three times in 2022; all in the effort to stem runaway inflation. The Fed has two mandates: maximum employment, and stable prices meaning moderate and stable inflation.” Keynesian economics argued that the government could tax and spend its way to full employment”, wrote the former president of the Federal Reserve Bank of St. Louis in 2005. If that economic theory sounds familiar it should. Consider our government’s response to the Covid-19 pandemic and the massive increase of our money supply.

We’ve faced the monster of inflation before.

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  1. Are any lenders actually using SOFR yet?


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