how does one correct an error that has manifested in the collective mind as a false security for over 100 years? one doesnt. the "weird" stuff usually brings out the real stuff.

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Hi Kyla, I posted this on Joseph's twitter but I'm sure you are equally capable of answering! Just looking for a bright mind to bounce an idea off of... :)

Curious as to your opinion on the best policy response to the current inflation that we are seeing. It seems that it is likely the result of:

1: Increased AD from increased savings as a result of accomodative fiscal policy during COVID

2: Decreased AS from increased transportation costs, lead times, etc.

3: Decreased AS from increased fuel costs from Russia's invasion of Ukraine

?4?: I'm also wondering whether there has been a significant positive effect on AD from frothy markets (crypto, stock market) increasing the value of people's savings and leading them to feel wealthier and leading to more consumption.

What do you think the dominant effect is? I guess what I'm bouncing around in my head is whether I think the increased AD is more short term than the decreased AS and that by tightening the fed funds rate you are further exacerbating a problem that is playing out as higher inflation due to supply shocks. What happens when consumers burn through the helicopter drops of money and fiscal policy normalizes (which should happen very soon)?

Would love to hear your opinion!

Thank you!

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