Biden policies ‘duped the Fed’: Economist Peter Morici

Former Chief International Trade economist Peter Morici told FOX Business' "Varney & Co." on Wednesday that President Biden's policies "duped the Fed" into thinking they can print as much money as they want and the "consequences have arrived." 

YELLEN INSISTS FED WILL MONITOR INFLATION, HAS TOOLS TO CONTROL IT AS BIDEN PLAN UNDER SCRUTINY

PETER MORICI: The month-over-month numbers are very disturbing. We are seeing price increases that cannot be dismissed as transitory because they're the kinds of price increases that are going to compel people to ask their bosses for more money. Compounding that with what's going on in the gasoline market now, even before the Colonial shutdown, President Biden's policies are very inflationary. They basically duped the Fed through Janet Yellen into thinking they can print as much money as they like and it won't have consequences. Well, the consequences have arrived. 

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When they were talking about averaging inflation over several years, I think they were talking about, well, we'll get two and a half percent for a while to average out the one and a half percent last year and that sort of thing. But what do you do if you start getting four or five percent inflation? Consider Florida. With all those retirees, they're getting very little interest on their money at the bank and they're getting clobbered by inflation on the value of the balances. I mean, this is an extraordinary tax on the elderly. They're going to be hearing about this from a lot of places. Also, inflation like this is toughest on the poor people, that are supposed to be Mr. Biden's principal concern and constituents -- good luck on that. What you're about to see is this printing press economics, you know, that's basically being pushed by his Council of Economic Advisers, this new monetary theory blows up in the Oval Office.

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There's enormous demand for things that people would not normally buy if it were not for the fact that they have all this extra cash. That's the first thing. The second thing is what we buy and use has shifted, which is creating lots of kinks and brittle points in the supply chain. Some of that will resolve. But this is such a large impulse, it's ludicrous to think. And the Federal Reserve Chairman Powell has offered no evidence to indicate that he can categorically say that this is just a burst. 

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