During an interview aired on Friday’s edition of Bloomberg’s “Wall Street Week,” Harvard Professor, economist, Director of the National Economic Council under President Barack Obama, and Treasury Secretary under President Bill Clinton Larry Summers stated that the Federal Reserve’s inflation brakes aren’t getting much in the way of traction and the median inflation component “running close to 7%,” along with “a general broadening of price pressures” “has got to cause real concern about inflation.”

Summers said, “The Fed’s been trying to put the brakes on, and it doesn’t look like the brakes are getting much traction. And when your brakes don’t get much traction, two things happen: You can be moving too fast. That’s the inflation pressure. And you can be setting yourself up for some kind of collision or crash down the road. And both of those things I think are real risks in this environment. We clearly have an economy where demand is super strong, the highest ratio of vacancies to unemployment we’ve ever seen, retail sales on fire, the economy creating jobs faster right now than population growth by a factor of five in the latest month. If you look at the broadest measures of inflation, the median inflation component [is] at its highest rate in 40 years, running close to 7%, a general broadening of price pressures. So, that has got to cause real concern about inflation.”

He added, “At the same time, the Fed has to be very careful. I don’t think those who think inflation is slowing, therefore it’s obvious that we’ve got to hit the brakes very hard necessarily are right, because if you look at accumulations of inventories, if you look at what’s happened to the savings rate, if you look at how many firms have built up their payrolls, if you look at signs of a bit of euphoria coming back into some stock markets, you also have the possibility of that Wile E. Coyote moment that I’ve been referring to that could come, not next month, but could come some time in the next few months.”