Will Rising Interest Rates Tame Inflation?

January 20, 2022
Getting inflation under control is job one at the Fed right now, so rates are set to rise. But how soon, how much, and at what cost to the economy?

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After you listen

No one is happy with the recent inflation run-up, least of all the Federal Reserve, whose mandate includes keeping inflation at a manageable pace. For this fight, one of the main arrows in the Fed's quiver is to raise interest rates in hopes of curtailing spending and bringing prices back in line­. But how much will it take, and how painful will that be for the economy? Kathy Jones, Schwab's chief fixed income strategist, joins Mike Townsend to consider how far the rate hikes will go, what the impact may be on jobs and the markets, and how the new faces soon to join the Fed could impact the decision-making process at the central bank.

Mike also looks at how the stalled Build Back Better Act means that a host of tax increases that investors thought might go into effect in 2022 remain in limbo—and whether they might come back to life if a new version of the bill emerges. He examines the risk of a government shutdown as Congress scrambles to fund the federal budget ahead of a February 18 deadline. And he discusses emerging bipartisan support for measures to prohibit government officials from using inside knowledge for their personal investing.

WashingtonWiseis an original podcast for investors from Charles Schwab.

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