Citing inflationary concerns, Deutsche Bank is breaking from Wall Street consensus to condemn the Federal Reserve.
Chief economists from Deutsche — one of the largest and most important private financial institutions in the world — characterized the global economy as “sitting on a time bomb” due to the central banks’ lax disposition toward inflation.
Historically, the Federal Reserve — the central bank of the United States — has targeted a low and stable inflation rate in their objective to balance unemployment and price levels. As the Fed plans to continue aggressive quantitative easing through 2023, the Biden administration is proposing trillions of dollars in new spending on social programs. As a result, inflation recently reached its highest levels since the Great Recession.
“It is no exaggeration to say that we are departing from neoliberalism and that the days of the new-liberal policies that begun in the Reagan era are clearly fading in the rear view mirror,” wrote Deutsche Bank economists David Folkerts-Landau,