lol.. delicately put (as always).
Perhaps I should've rephrased --> "cause inflation expectations to rise".
Here's what the St. louis fed thought in mid 2014:
"more monetary injections during a liquidity trap can only reinforce the liquidity trap by keeping the inflation rate low (or the real return to money high). ....the correct monetary policy during a liquidity trap is not to further increase money supply or reduce the interest rate but to raise inflation expectations by raising the nominal interest rate."
Chicken or the egg really.
My guess is that there will also be supply side pressures once tightening begins. But maybe it'll hit demand even more. Guess we'll find out soon.
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lol.. delicately put (as always). Perhaps I should've rephrased...
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