Wharton University economics professor Jeremy Siegel said in his statement that the Fed should follow tighter policies on rapidly increasing interest rates. Stating that the inflation in the USA started to get out of control, Siegel said, of bitcoin He called on the central bank to protect the dollar from devaluation against the dollar’s replacement.
“Dollar in Danger Against Bitcoin”
Siegel, who had an interview with Rebecca Quick on CNBC’s Squawk Box, evaluated the measures taken by Fed Chairman Jerome Powell against recent events. Powell was signaling a serious rate hike this month, but some people were skeptical that the Fed would stand by its decision after the Russian invasion of Ukraine.
Despite this, Powell gave no indication that he would slow down on rate hikes in his statement to the United States House of Financial Services Committee yesterday. However, Powell noted that things could get complicated due to the situation in Ukraine.
Siegel, on the other hand, said he had doubts that the Fed will continue its moves to stop inflation with determination. The professor cited the Fed’s misjudgments on the subject and the wrongful characterization of inflation last year as a “temporary situation”. US inflation remains high.
Both Jeremy Powell and Treasury Secretary Janet Yellen admitted last year that inflation, which they had described as temporary, was not temporary. However, the head of the European Central Bank, Christine Lagarde, still argues that inflation will not affect Europe as it does the USA.
According to Siegel, despite the conflicts between Russia and Ukraine, the Fed needs to take responsibility for monetary policy and reach its targets. According to the professor, otherwise like Bitcoin cryptocurrencies can pose a serious threat:
“We need to defend the US dollar. We’re talking about Bitcoin replacing the dollar. That’s why we have to defend the dollar.”
*Not investment advice.