This is probably not a surprise to anyone on this forum, but this would be one way to address the inversion of the yield curve. With inflation being tame over the past several years according to the numbers, I think it's good to look a little deeper at that number. I've seen food packaging steadily shrinking over the years which is one example of hidden inflation. Since food is not part of core inflation numbers, it likely doesn't contribute much to the number.

However, autos are a great example of where the system fails to capture what I consider "real inflation". They hide this by stating that you are getting a lot more car now vs 10 years ago so price to value ratio is largely flat. This is a combination of forced gov't enhancements coupled with car companies rolling in added cost features into the base models.

https://www.wsj.com/articles/feds-kashka..._lead_pos4

Quote:Neel Kashkari, one of the Federal Reserve’s most consistent opponents of interest-rate increases, says it isn’t the time for the central bank to cut borrowing costs.

For now, the Minneapolis Fed president believes the U.S. central bank is in the right place, he said in an interview with The Wall Street Journal Friday. He spoke in the wake of the Fed’s recent decision to hold rates steady and signal it is unlikely to raise them this year.

He and other Fed officials have cited recent weak U.S. economic data, including soft inflation and slowing global growth as reasons to hold off on more rate increases for a while as they assess the health of the expansion.

“Some of the risks have shifted to the downside, so pausing to get more information, to see if this really is an economic slowdown or if it’s just a blip, I think that’s the right move,” Mr. Kashkari said. “My underlying thesis for why it doesn’t make sense to raise rates continues. But I think economic weakness has caused the rest of the [Fed’s rate-setting] committee to say it’s an appropriate time to pause, and I support that.”

Mr. Kashkari has long said he saw no reason to raise rates because inflation has run below the Fed’s 2% target almost continuously for several years. He added the Fed could easily raise rates if it did see price pressures pick up too much.

Until recently, his opposition to rate rises was shared only with St. Louis Fed President James Bullard. But now their position is common among their colleagues.