Kevin Warsh could face a buzzsaw when he takes over as Federal Reserve chair — a Hobson’s choice between fighting inflation and protecting the labor market. The Fed is duty-bound to support both sides of its sometimes conflicting dual mandate: stable prices and full employment. There essentially are three ways to do that: raise interest rates to fight inflation by dampening demand, lower rates to support economic growth and hiring, or — most preferably — keep rates where they are to maintain a balance between the two. Brewing economic conditions suggest, however, that when Warsh takes office, presumably in May, ... (full story)