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John Cochrane addresses the topic of inflation, noting that the current level matches expectations.
He points out that while this situation is not as severe as a debt crisis, it still represents unfavorable news for the economy.
Cochrane previously argued that a one-time unfunded fiscal expansion, rather than central bank policy, was the main driver of inflation. He cited Switzerland as an example of a country with lower inflation due to less fiscal blowout. In another article, he said that using a price level target can help strengthen inflation expectations after periods of deflation.