Once again, the Fed raised the federal funds rate too far, inverted the yield curve, watched job losses slam millions of people and then rushed to minimize the damage. Kashkari explains that if the markets were expecting higher inflation or stronger inflation-adjusted economic growth in the future, we would see that evidence in long-term bond yields. Obviously, Kashkari and other Fed colleagues understand that the central bank could stop purchasing 20% of newly issued long-term bonds and/or conduct a "reverse twist" to steepen the yield curve.