“At this stage, two things seem pretty clear: Inflation is high and will likely remain above target for a few years. My own view is that the FOMC is painting a rather rosy picture, and that market expectations provide a better guide for estimating inflation.” ~ William J. Luther
READ MORE“Only a monetary policy geared to reduce inflation will be effective in reducing inflation. This is as true now as when the Federal Reserve lowered inflation in the early 1980s.” ~ Gerald P. Dwyer
READ MORE“Words mean different things to different people, and their meanings change over time. How we define inflation is a matter of choice, but we must also recognize that choice reflects more fundamental beliefs about how the economy functions.” ~ Michael J. Douma
READ MORE“If we want to argue deficits matter more conventionally, we’ll have to do some more theoretical heavy lifting. The usual aggregate demand stories we tell don’t cut it.” ~ Alexander William Salter
READ MORE“One thing we can confidently project about 2022 is that year-to-year measures of ‘inflation’ in prices of used cars and energy will be near zero by the third quarter, if not below zero. That is nearly a sure thing, baked-in-the cake.” ~ Alan Reynolds
READ MORE“The AIER Leading Indicators index held steady again in December, coming in at a neutral 50 for a third month. The result suggests continued economic expansion but with elevated risks. Shortages of labor and materials continue to sustain upward pressure on prices but there may be some early signs of easing for some of those issues.” ~ Robert Hughes
READ MORE“It is rarely prudent to assume that a central bank’s central planners can predict the future better than you can, or that they really know what they are doing and why.” ~ Alan Reynolds
READ MORE“It seems the Fed is not committed to hitting its average inflation target. Inflation will be transitory in the sense that the rate will eventually return to 2 percent. But the price level will likely remain elevated.” ~ William J. Luther
READ MORE“The threat of inflation has been apparent for some time now, but those who have the power to do something about it seem to have the attitude that it will go away on its own.” ~ Randall G. Holcombe
READ MORE“The usefulness of supply and demand is most obvious in the case of microeconomics, which focuses on households and firms. But it’s just as handy for macroeconomics in studying economy-wide phenomena like growth and business cycles.” ~ Alexander William Salter
READ MORE“Once we move from the realm of small price level movements to a more permanent and higher inflation rate scenario, it is more likely that the source of the rise in the price level is on the monetary side—even if the government doesn’t want to admit it.” ~ Nicolás Cachanosky
READ MORE“The Fed must act boldly and swiftly to course correct. Otherwise, inflation expectations could become unanchored––leaving the Fed to choose between restoring its credibility by engineering a recession or tolerating high inflation in perpetuity.” ~ William J. Luther
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