Stuff That Interests Me

I was at a dinner the other night with a buddy who is a much cleverer investor than I am. The conversation went something like this.Clever Mate: “Inflation is 10%. Rates are going to have to go to 10% to get it under control. I’m 60% in cash.”Me: “The system can’t take rates at 10%.”Clever Mate shrugs. There is an awkward silence.Clever Mate: “It will have to.”Another more awkward silence follows as I digest the implications. Do central bankers have what it takes to tackle inflation?Have today’s central bankers – the liof Jerome Powell, Christine Lagarde and Andrew Bailey – got the bottle to “do a Volcker” and put rates up to these kinds of levels? (In 1981, then-Federal Reserve chairman Paul Volcker raised the Fed Funds rate to 20%.).It’s not just the chair or the governor, of course – though they will be the ones making the announcement – but the boards behind them. To make such a decision, with such ra