Fed Will Raise Rates Until Labor Market Cracks: Kroszner

The transcript discusses the challenges of understanding economic statistics in the context of new technology and post-COVID changes. It highlights the Federal Reserve's focus on the labor market and inflation, emphasizing the need for wage moderation to achieve economic stability. The concept of 'Immaculate disinflation' is explored, questioning the possibility of reducing inflation without increasing unemployment. The discussion also covers labor market participation issues, particularly the impact of early retirements.

What is the Federal Reserve's primary focus to control wage inflation?

• Slowing down the labor market

• Reducing government spending

• Increasing taxes

• Increasing interest rates

What is meant by 'Immaculate disinflation'?

• Increasing unemployment to reduce inflation

• Reducing interest rates to control inflation

• Increasing inflation to boost the economy

• Reducing inflation without increasing unemployment

Which factor is NOT mentioned as necessary for achieving 'Immaculate disinflation'?

• Decrease in wages

• Increase in labor market participation

• Increase in demand

• Slowdown in demand

What does Jay Powell identify as a reason for low labor market participation?

• Increased automation

• Lack of job opportunities

• Accelerated retirements

• High unemployment rates

What is the suggested method to slow down wage increases?

• Increase in government subsidies

• Slowdown in demand for workers

• Decrease in interest rates

• Increase in foreign labor