One of the biggest overhauls in monetary policy in recent years was the Fed's announcement at the end of August that the US central bank would target average inflation going forward (without however giving any specifics - what is the target inflation rate? what is the lookback period for calculating the "average" - 1 year, 5 years, 50?). To many this was nothing more than a strawman designed to give the Fed leeway to not hike rates (which would hammer bond and stock prices) even if inflation runs away in the coming years (as a reminder the biggest debate in modern finance is what comes after the covid pandemic, inflation or deflation, with prominent financial gurus on either side of the debate).
Instead, as we have often written and as increasingly more mainstream commentators now agree, a far more necessary debate the Fed should hold is how inflation is measured for the simple reason that starting in the 1980s, the calculation of inflation as measured by either the CPI or PCE became political, and meant to give Congress the capacity to continue spending without a "budget constraint." For more see the following articles:
Now, none other than a Harvard Professor has emerged on our side of this debate, arguing that the true cost of living is far higher than the laughable official CPI print of 1.3% would have the public believe.