I remember a Federal Reserve economist once recounting a conversation with his young daughter, who asked him, “What do you do at work, Daddy?” He answered, “I help make important decisions.” “What kind of decisions, Daddy?” “Oh, things like how much money the government needs to print.”
Category Archives: inflation
Pretty Darn Good…(An Update on “Two Recession Bush Presidency?”)
Two months ago, I posed the question “What Are the Prospects for a Two Recession Bush Presidency?” I think the answer is indeed “pretty good”, given the recent data.
Commodity prices and the Fed
If the Fed thinks that recent commodity price moves have nothing to do with their own actions, perhaps they should think again.
Just how badly is the U.S. economy doing?
That’s the topic of a piece I wrote for today’s San Diego Union-Tribune.
Bernanke’s tightrope act
Some analysts are saying that Fed Chair Ben Bernanke is walking a tightrope– if he does not drop interest rates quickly enough, the U.S. will be in recession, but if he goes too far, we’ll see a resurgence of inflation. I am increasingly persuaded that’s not an accurate description of the situation.
Musings on the Dollar: PPP and Thresholds
As the dollar hits a new low against the euro [0], some thoughts on what arguments make sense, given our knowledge of the statistical properties of real exchange rates.
Did somebody say stagflation?
Five weeks ago I asked, Will inflation fears restrain the Fed?, and my answer was that they would not. Certainly inflation fears did not prevent the Fed from lowering its target for the fed funds rate by 125 basis points since I offered that assessment. But I believe that this week’s data will force the Fed to be more cautious about the magnitude and pace of subsequent rate cuts.
Trade, Exchange Rates and Pass Through
Some thoughts on what to make of the trade and export/import price releases.
More Things I Learned at ASSA: Inflation and Labor Cost Measures
One of the AEA sessions I attended (at least in part — I missed the first paper) was titled (excitingly) “Reconciliation of Seemingly Inconsistent Data Series”.
Will inflation fears restrain the Fed?
I think not, and here’s why.