From the opinion pages of the Wall Street Journal, this is Free Expression with Jerry Baker.

Hello and welcome to Free Expression with me, Jerry Baker, from the Wall Street Journal opinion pages.

Thank you very much indeed for listening. I hope you're a subscriber. If you're not already,

please subscribe at Apple Podcasts or Spotify or wherever else you get your podcast, and please leave us a

review. This week, as 2022 comes to a close, the outlook for the US economy is especially cloudy.

Inflation continues to be the biggest challenge facing the American people and their economic

policymakers. Now, while the headline rate of inflation and consumer prices has edged down in the last

couple of months, it still stood at an annual rate of 7.7% in

October, and the core rate of price increases remains close to levels that haven't been seen

in decades. The Federal Reserve, which belatedly recognized late last year that inflation was not,

after all, transitory, as it had once claimed. It has been running over hard ever since to catch up,

raising its key interest rate this year from close to zero to nearly 4%. It's still expected to go higher, though on Wednesday, Federal Reserve Chairman Jay Powell said in an important speech that it would now probably make sense for the Fed to slow the pace of its tightening, suggesting perhaps that rates may rise by another half point in December

and maybe only a little bit more after that. This was greeted quite positively by the markets.

But while this Fed policy may finally be starting to slow the inflation rate, it's increasingly

likely that the rate increases will push the economy into recession. In a recent survey of

economists for the Wall Street Journal,

a large majority forecast a recession in 2023. So what is the outlook? Has inflation peaked?

Will the price of overcoming inflation be a slump? Worse of all, could we be back to an era of

stagflation, that unusual phenomenon of high inflation and weak or negative growth.

Well, to talk about all this, I'm joined this week by a leading economist and former vice chair of the Federal Reserve, Alan Blinder. Professor Blinder is Professor of Economics at Princeton University, who was appointed to the Fed by President Bill Clinton in the 1990s. He also served on Clinton's Council of Economic Advisors. He's published extensively on economic subjects, especially on monetary policy.

And he's out with a new book,

A Monetary and Fiscal History of the United States. of economic advisors. He's published extensively on economic subjects, especially on monetary policy.

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