Increased Spending in the ‘Inflation Reduction Act’ Will Impede Efforts to Reduce Inflation

BlackRock CEO Larry Fink Discusses Inflation Challenges

Fiscal Stimulus Impact on Inflation

During a recent appearance on CNBC’s “Squawk on the Street,” BlackRock CEO Larry Fink expressed his skepticism about reaching a 2% inflation rate. He attributed this difficulty to the significant fiscal stimulus present in initiatives like the CHIPS Act, the Infrastructure Act, and the IRA.

Service Inflation and Economic Policy

Fink highlighted the challenges in achieving the desired inflation rate, noting that despite widespread enthusiasm, the goal of 2% inflation remained elusive. He pointed out the impact of fiscal stimulus and poor legal immigration policies on job markets, contributing to inflationary pressures.

Factors Driving Inflation

Further delving into the issue, Fink discussed the role of service inflation in driving overall inflation rates. He identified factors such as an aging housing stock leading to increased insurance costs, rising healthcare expenses, and changing consumer behaviors impacting inflation numbers.

Central Banks’ Struggle

Fink emphasized the challenges faced by central banks in controlling service inflation, citing examples of stable product prices contrasted with soaring costs of experiences like attending sporting events or concerts. He highlighted the disparity in price stability between goods and services, illustrating the complexity of inflation dynamics.


In conclusion, Fink underscored the evolving nature of inflation trends and the difficulties in managing service inflation. He referenced the consistency in product prices over the years compared to the significant price hikes in experiential services, reflecting shifting consumer preferences and behaviors.

Follow Ian Hanchett on Twitter @IanHanchett

Read More of this Story at – 2024-04-13 09:34:30

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