Austan Goolsbee

But

This is among the toughest challenges because there's no obvious playbook.

And we knew, we didn't know it was going to come within a few months.

But last year, we put out a monetary policy framework review that's kind of said, here's the way we do things.

Here's our goal is 2% inflation.

And we said, if we're ever faced with shocks to both sides at the same time—

We're gonna basically ask which side is getting worse more and how long do we think it's gonna last?

And I don't think that's a terrible approach to take, but realistically, like you say, when you get supply shocks,

It's not obvious that the Fed can do anything or the central bank can do anything.

Raising the rates doesn't fix it.

Cutting the rates doesn't fix it.

And leaving them where they are doesn't fix it.

So now you're hitting and hoping at the same time.

First, let's think about Strait of Hormuz.

High oil prices can be a stagflationary shock in itself.

And we've seen that multiple times.

That's qualified a little bit now because the U.S.

became a big energy producer, not just a user.

But if the Strait of Hormuz is shut, has a toll taker on it, if we're going to have oil prices be $100 a barrel,

and it's not going to go away quickly, we're going to be dealing with the implications of that.