The last press conference by Federal Reserve Chairman Jerome Powell, which contained a kind of mea culpa regarding the Fed’s false “temporary” inflation call, failed for one of the nation’s leading economists: Larry Summers.

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Although the “pivot” was necessary, said Summers, who was Treasury Secretary under President Clinton and director of the National Economic Council under President Obama, he still thinks central bankers are pretty clueless.

“Recognition of the need to change direction, as expressed in the statement by the Federal Reserve Open Market Committee and Chairman Jerome H. Powell’s press conference on Wednesday, was necessary, but not sufficient, for price stabilization and sustainable growth to be successful to achieve both the intrinsic difficulty of the task at hand and the misunderstandings that the Fed still appears to harbor, “Summers wrote in a Thursday comment.

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Powell and his central bank colleagues were impaled among financial watchers for insisting that inflation was “temporary” as food and energy prices skyrocketed. In November consumer prices rose 6.8%, the highest since 1982, and producer prices 9.6%, the highest ever recorded.

During his press conference, Powell acknowledged that “supply and demand balances related to the pandemic” will continue to drive inflation.

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“These problems were bigger and longer lasting than expected and were made worse by the waves of the virus. As a result, headline inflation is well above our longer-term target of 2 percent and is likely to continue well into next year, ”he said. Inflation is now estimated at around 5.3%, while it will fall to 2.6% next year as unemployment hits 3.5%.

But Summers won’t buy it. He writes that inflation has stabilized only a few times without a recession. He also doubts that the three planned rate hikes in 2022 will be enough to bring monetary policy back to “normal”.

In fact, he suggests that inflation could get even hotter, driven by “catching up” rental prices that have lagged the broader rise in the CPI.

And then there are those almost record-breaking 11 million job offers. In order for employers to fill the gaps, labor costs may need to rise, warns Summers, a slap in the pit of your stomach for profits.

The Fed may need to get more radical to contain inflation, suggests Summers.