Let's back up.

Currently, policymakers are not targeting income and certainly not aggregate spending. We remain in inflation targeting regimes.

So how does fiscal policy affect inflation-targeting regimes?

<aside> 💡 Inflation is poorly understood. Let's review our current understanding.

• The 4 causes of inflation
• Inflation mechanics </aside>

By now we understand what inflation is, how it can be caused, and the risk of bypassing the fist that would typically keep it in check.

But now we must ask, what is required to actually drive inflation?

<aside> 💡 Preconditions for inflation

• Stimulus does not necessarily cause inflation
• What to be on guard for </aside>

How do we fight inflation?

<aside> 💡 Inflation is hard to fight

• Counteracting inflation
• An inherently political problem
• Scenario possibilites </aside>

How do we handicap these possibilities?

<aside> 💡 Reasoning through the tree

• 1. Start with the prevailing Fed mindset
• 2. Identify the constraints
• 3. Estimate the impact of the stimulus
• 4. Consider the counterforces </aside>

• So what does Jesse present as possible paths?