Aug 26, 2026 · 5 min · 5 segments
Steve Forbes urges Fed Chair Kevin Warsh to get extremely real about inflation at the Jackson Hole conference, and reject the false belief that raising interest rates will combat inflation. Learn…
Steve ForbesHost
Tomorrow, financial and central bank bigwigs from numerous nations repair to beautiful Jackson Hole, Wyoming for a yearly get-together put on by the Federal Reserve.
Technically, the sponsor is the Fed's Kansas City branch, but no one is fooled as to whose show it really is.
There couldn't be a more awesome backdrop than the Teton Mountains to discuss various monetary issues, both major and technical.
Unfortunately, what usually comes out of these confabs is more reminiscent of misbegotten molehills than majestic mountains.
The highlight is usually the speech delivered by the leader of the Federal Reserve, where many a time important policy pronounces are made.
He is under attack by Federal Reserve reactionaries who don't like the fact that their new boss wants to change the way things are done.
One of their gripes is that Warsh welcomes actual debate instead of striving for North Korean-like unanimity.
As the record makes painfully clear, our central bank can no more actually gauge the future than the rest of us.
You'll learn more from tarot card readers than the Fed's so-called forward guidance.
To undermine him, critics have been whispering that Warsh's unwillingness to hint what the Fed might do next on interest rates demonstrates that he is weak on battling inflation.
What the acidic whisperers reveal is their own wrongheaded beliefs about inflation.
To them, it is gospel that to fight inflation, you must raise interest rates and slow the economy.
Many, including economists and decision makers at the IMF, even subscribe to the notion that devaluing a currency will make a country more competitive.
This deranged dogma on how to deal with inflation has done immense damage over the years.
It has suppressed growth rates, a particularly obscene outcome for developing countries.
During the 1970s and early 1980s, for example, peacetime inflation reached record levels, and so did interest rates.
Central bankers and economists can't seem to grasp that the very definition of inflation is lowering the value of a currency.
Price changes resulting from disruption to production by wars, natural disasters, costly regulations, or pandemics don't justify higher interest rates.
The way to cure inflation is announcing that the operating core monetary policy is keeping the currency steady in value.
The superstition that you fight inflation by jacking up the cost of money and suppressing the economy belongs in a dumpster, not in the halls of central banks and finance ministries.
Tomorrow, financial and central bank bigwigs from numerous nations repair to beautiful Jackson Hole, Wyoming for a yearly get-together put on by the Federal Reserve.
Technically, the sponsor is the Fed's Kansas City branch, but no one is fooled as to whose show it really is.
There couldn't be a more awesome backdrop than the Teton Mountains to discuss various monetary issues, both major and technical.
Unfortunately, what usually comes out of these confabs is more reminiscent of misbegotten molehills than majestic mountains.
The highlight is usually the speech delivered by the leader of the Federal Reserve, where many a time important policy pronounces are made.
He is under attack by Federal Reserve reactionaries who don't like the fact that their new boss wants to change the way things are done.
One of their gripes is that Warsh welcomes actual debate instead of striving for North Korean-like unanimity.
As the record makes painfully clear, our central bank can no more actually gauge the future than the rest of us.
You'll learn more from tarot card readers than the Fed's so-called forward guidance.
To undermine him, critics have been whispering that Warsh's unwillingness to hint what the Fed might do next on interest rates demonstrates that he is weak on battling inflation.
What the acidic whisperers reveal is their own wrongheaded beliefs about inflation.
To them, it is gospel that to fight inflation, you must raise interest rates and slow the economy.
Many, including economists and decision makers at the IMF, even subscribe to the notion that devaluing a currency will make a country more competitive.
This deranged dogma on how to deal with inflation has done immense damage over the years.
It has suppressed growth rates, a particularly obscene outcome for developing countries.
During the 1970s and early 1980s, for example, peacetime inflation reached record levels, and so did interest rates.
Central bankers and economists can't seem to grasp that the very definition of inflation is lowering the value of a currency.
Price changes resulting from disruption to production by wars, natural disasters, costly regulations, or pandemics don't justify higher interest rates.
The way to cure inflation is announcing that the operating core monetary policy is keeping the currency steady in value.
The superstition that you fight inflation by jacking up the cost of money and suppressing the economy belongs in a dumpster, not in the halls of central banks and finance ministries.
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