During his "My Take," Thursday "Varney & Co." host Stuart Varney discussed the threat of higher taxes and rising interest rates to the economy, warning that if the U.S. is hit with both, Biden will have to add a recession, and maybe stagflation, to his list of problems in an election year.
STUART VARNEY: Here's a frightening vision.
Tax hikes and rate hikes – that wouldn't be good if we got them both.
At the Federal Reserve, half the board members want interest rates to start going up again, after a brief pause.
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At the White House, the president wants higher taxes on businesses and on wealthy people.
Tax hikes and rate hikes. I don't know whether we get either, but it's worth looking at how we got here. It's a story of past mistakes that are taking a bite out of us now.
Jay Powell at the Federal Reserve turned on the money spigot and kept it flowing for much too long. He was trying to get the economy going after the pandemic, so he printed trillions of dollars.
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I have no doubt Joe Biden wanted him to do that because it gave us a sugar high. Now, Powell has to tamp down on the inflation that he helped to create.
The threat of higher rates is still in the air because inflation is still with us. As for tax hikes, well, that's the result of Joe Biden taking a hard left turn when his presidency began.
He went "green" with Alexandria Ocasio-Cortez, and he went socialist with Senator Sanders who, incredibly, is the socialist Chair of the Senate Budget Committee.
So, tax the rich, tax the wicked capitalist corporations.
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As I said, I don't know whether we will get both rate and tax hikes, but if we did, you'll be hearing the word recession bandied about. Maybe even stagflation, that is higher prices with a slowing economy.
Yes, that would hurt us all, but it would surely hurt Jay Powell's reputation.
"Look what you did to us, Jay."
It would hurt Joe Biden too. He doesn't want to go into an election with a recession to add to all his other problems.
I hope the chickens don't come home to roost because I want to live in a prosperous America. Rate hikes and tax hikes are not going to do it.
