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The apparent consequence of MMT has been to sensitize markets to lower interest rates. This makes higher interest rates significantly more painful for markets, and is a major obstacle to the Fed executing its rate hike strategy.

The structural relationship between interest rates and monetary policy ultimately is non-existent. As Friedman argued in 1968, the Fed can't peg interest rates for too long without things going off the rails. Monetary policy will always influence market interest rates, but any effort by the Fed either to leverage a specific interest rate or to target a specific interest rate is destined to end badly.

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You would have made a great economics professor, Mr. Kust!

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