I saw an article today where the Fed chief, Jerome Powell, an appointee of the tRump administration opined that 2% inflation was palatable in the short term and the Federal Reserve did not intend to raise interest rates within the next year unless full employment was reached and inflation continued to tick upwards. This is welcome news on the employment front. The Fed has traditionally confiscated the proverbial punch bowl before the party even started, allowing up to 4-5% of the workforce to languish in joblessness all in the name of fiscal probity. Recent experience has shown that even with unemployment below 3% there was very little inflation pressure on the economy. Good for you Mr. Powell!
On the bad side, Timothy Geithner, the former Treasury Secretary under the Obama administration who is now the head of a predatory equity firm, Warburg Pincus, is using a leveraged buyout to merge two of the largest security firms in the world into a behemoth, employing over 800,000 workers. By forcing a publicly traded company to take on 4.6 billion in new debt to finance the deal, cutting costs will be on the agenda of the new firm. This will probably lead to massive layoffs within a year or two. Geithner's firm will probably gut the firm of its assets and walk away with billions while the corpse of the two companies he plundered will languish until it is bailed out with public money. Bad, Mr. Geithner!
That is today's tale of two administrations.
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