fed: Inflation’s harsh realities on display as Fed officials meet

Christopher Ragber Jackson Hole (USA), Aug 25 (AP) A half-hour drive from the resort where the high priest of international finance – leading economists and central bank officials – has convened in Jackson Hole, Wyoming, to discuss the issue. Due to the world’s economic challenges, Ash Hermanowski oversees the distribution of about 1,200 free meals a day. At a food bank called Jackson Cupboard, Hermanowski hands out food from a commercial garage after being forced from a previous site by a bad sprinkler. The food bank couldn’t buy anywhere else in the city.

Across the street, The Glenwood, a collection of townhomes that will sell for millions, is nearing completion. “Unique luxury”, says its website, in a “truly comfy oasis”.

It’s “the ultimate irony,” Hermanowski said. “Employees and I, we talk about it all the time. We all struggle to live here, and they’re building high-end housing. This duality exists all over the city, but people don’t see it. denies.”

As the Federal Reserve’s annual economic symposium gets underway at a lodge in Grand Teton National Park on Thursday, some of the very problems Fed officials are grappling with — high inflation, rising rental costs and home prices, and wider economic inequalities — near. Delightful mountain setting can be found.

On Friday, Fed Chair Jerome Powell will give a speech that could signal how quickly the central bank may raise interest rates in the coming months. Powell’s comments will be scrutinized by Wall Street traders and economists and could potentially lead to sharp volatility in financial markets.

Powell The Fed has launched its fastest series of rate hikes since the early 1980s. The Fed is trying to slow the economy in order to quell inflation without causing a recession — a notoriously delicate act.

Inflation is particularly high in the city of Jackson and surrounding Teton County, which was the wealthiest and most unequal place in the country even before the pandemic broke out two years ago. (Jackson Hole is the name of the wide valley.)

The state of Wyoming has calculated that the cost of living in the county was 68 percent higher than the rest of the state at the end of 2021 – with housing costs 130 percent higher.

At the food bank, Hermanowski says, demand has picked up from a year ago as rising food and gas prices stifled their customers’ budgets.

Roughly 85 percent of food bank recipients have a job, often more than one, said Sharal Lund, executive director of one22, a nonprofit including Jackson Cupboard.

Like many resort towns, Jackson has always been expensive. But the pandemic has exacerbated the inequalities that have widened the gap between the rich and everyone else. Real estate prices soared that many affluent families, trying to escape the crowded cities, moved to the Jackson area or spent more time in vacation homes they already owned.

With many office professionals able to work remotely, the area’s natural beauty became a must-see attraction. Wyoming’s low tax status has also proven attractive to high-income earners.

Jackson, a city of about 25,000 people that still retains its aura as an Old Western town, has its arches carved from elk antlers around the town square. The square is lined with a “Cowboy Bar” and an old-timey “Five and Dime” shop.

Yet in the midst of such outlets are the symbols of the fast-growing Lux Jackson: high-end jewelry shops and a Swarovski crystal store selling a bald eagle figurine for $9,600.

“We definitely see both sides of it here,” said Hannah Cooley, executive director of Whole Food Rescue, a nonprofit that redistributes leftover food from restaurants and bakeries. are very wealthy. And then you have three immigrant families locked up in one-bedroom apartments.”

Already high home prices and rents in Jackson have escalated since the pandemic, as they have nationally, with people working as housekeepers, chefs and waiters at resorts facing a particular hardship. Average price of a house: $3 million, double what it was five years ago. According to state government data, the median rent for apartments in Teton County rose 12.4 percent last year to US$2,780.

Jackson Town Council member Jonathan Schechter says the median income in Teton County in 2019 was US$312,442, according to the most recent IRS data, nearly 50 percent more than Manhattan, the highest in the country and the second highest.

April Norton, director of the Jackson/Teton County Affordable Housing Department, points to a major obstacle to home construction: 97 percent of the county’s land is federally owned and cannot be developed. Retiring employees who bought homes at cheap prices decades ago are now selling them at prices so high that many current workers, even high-income professionals, cannot afford .

The county is trying several methods to address the lack of affordable housing. These include making homes available only to those who work locally and with caps on price appreciation. Such “deed-restricted” homes still sold for more than US$700,000, evidence of strong demand and limited supply.

Still, a county report shows that nearly 1,500 families seeking affordable housing have a waiting list, up from 1,100 last year.

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https://economictimes.indiatimes.com/markets/stocks/news/inflations-harsh-realities-on-display-as-fed-officials-meet/articleshow/93780673.cms

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