As Trump Cheers ‘100% Correct’ John Williams, Don’t Forget The MMT Connection
The only person who spends more time than Fed officials thinking about US monetary policy is Donald Trump. He also spends just about as much time talking about rates as policymakers themselves during any given week.
Is that appropriate? Why, no. Of course it's not. Or at least not from this president. But that's the world we live in now. As Pimco's Joachim Fels wrote earlier this month, "the heyday of central bank independence now lies behind us".
That contention is supported not only by egreg
I loathe Trump. But the Fed did raise rates too much too fast last year- 1 or 2 times too many- that is why they are in the pickle they are in now. The proper way to communicate this was to have your Treasury secretary privately communicate your displeasure- not tweet it yourself.
On a related topic, you can throw the Phillips curve in the garbage- it is a useful academic concept only for eco 101. It is not a useful policy concept because the curve is not stable through time even when it works. And during times of structural change, like after a financial crisis when the economy goes through 30 years of change in 5- you might as well use a oija board before resorting to Phillips curve analysis.
Ria,
The true Phillips curve was from inflation in real wage growth vs employment under the gold standard in England. It’s just been bastardized to justify bad policy as general price inflation under fiat currency. Makes one wonder eh? Or at least me
The Smart Anonymous
Did you see Bullard remark that he would like to be Fed Chair? From The NY Times: “Fed chair is of course something I’d love to do,” Mr. Bullard told reporters after giving remarks in New York on Friday. “If I ever got that honor, I would certainly take it. I notice the phone has not been ringing off the hook to get that.”. Why should the phone be ringing now? It might have been nice for him to say something about the position being filled until 2022, and support the law providing only for dismissal with cause. Otherwise, he might get the job only to find others campaigning for his new position right away. Are we looking to a future where Fed members pander on dovish statements in order to campaign for the job? https://www.nytimes.com/2019/07/19/business/feds-bullard-says-he-would-take-chair-job-if-trump-offered.html