Inflation and Interest Rates

Inflation has surged to its highest levels in 40 years, impacting the lower-income population the most. The central bank's response involved raising interest rates from 0% to 4.5% and selling off a trillion dollars in assets to tighten financial conditions. This drastic shift has left banks, like Silicon Valley Bank, struggling with bonds that now yield significantly less than current rates, highlighting the complexities of managing economic stability.