The David Lin Report · Wednesday, July 1, 2026
EJ Antoni argued that raising interest rates to combat inflation caused by supply shocks, like the oil shock in the 70s, is the wrong policy. He asserted that attempting to fix a non-monetary problem with a monetary tool is ineffective and only compounds the issue, likening it to using a hammer for a screwdriver.
“Is that the correct policy here, EJ? >> No. And and history has told us, David, that it's not the case. You we had the Fed make exactly that mistake in the past. You can go back several decades when we had an oil shock in the 70s and how did the Fed respond? They tried to fight those rising prices by raising interest rates and all it did was simply compound the problem because you can't take a monetary tool and try to fix a nonmonetary problem.”
“you know, if you need a screwdriver, don't go reaching for a hammer. All you're going to do is is break something else, right? Well, that's exactly what the Fed did.”