Economic stability: What the Fed can and can’t do to restore it
As the Federal Reserve starts to tighten its money spigot for the economy for the first time since the pandemic began in 2020, today’s boost in interest rates feels different.
This policy about-face comes in circumstances more sensitive than most economic cycles: Inflation is at a 40-year high, a war in Ukraine is rattling global energy and food markets, and the pandemic still weighs on households around the world.
Amid all this, the Fed is expected to act as an economic stabilizer.
The central bank is not a wizard, but Congress has granted it vast financial clout – with the mission of pursuing twin goals of price stability and
