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Fed Needs to Hike to Slow Inflation Without Recession, Credit Suisse Says

  • Officials may engineer correction in stocks, Bitcoin, housing
  • Lower prices ‘won’t kill growth,’ Credit Suisse analyst says
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The Federal Reserve needs to deliver a Volcker-style shock to drive down asset prices if it wants to slow inflation without causing a recession, according to Credit Suisse Group AG strategist Zoltan Pozsar.

Policy makers should stoke volatility to set off corrections in assets including stocks, houses and Bitcoin, deterring early retirement and driving people into the workforce, Pozsar wrote in a note to clients. His comments harked back to the way Paul Volcker broke the back of inflation in the 1980s with massive rate increases.