We said from the moment Biden announced he would reappoint Jerome Powell as Fed chairman that given the alternatives the White House was considering, Powell was as good as we could expect. And that’s still sadly true.

But Powell has had an awful year as the pilot of our monetary policy and the blame for 7% inflation rests at his doorstep – though Biden’s runaway spending and borrowing gets a big assist. He pathetically talked about climate change during his confirmation hearing yesterday – as if he thinks monetary policy can change the temperature of the planet.

We’ve been arguing that the Fed has had the inflation story wrong for the past nine to twelve months and that they are WAY behind the curve in moving off its near-zero interest rate policy. Today’s announcement of 7% inflation for 2021 is sad confirmation that we’ve been right.

At the start of the year, Jerome Powell said that inflation was “not a problem.”

Then in the summer and fall he said rising prices were “transitory.”

His new term for inflation is a little more worrisome: “entrenched.” As in his recent statement that the Fed may have to “use some of our tools” to “prevent higher inflation from “become entrenched.”

Well, at least he’s now at the stage of grief that he admits the Fed has a problem.