Apr

16

In comments earlier this year the Chair wrote, "When will someone explain to Fed. Governors that the stronger the economy, the less likelihood there is of inflation, as there is expansion to absorb the money supply."

Sympathetic to your view, Dallas Fed President Richard Fisher wrote the following in a Wall Street Journal op-ed earlier this month: "… faster output growth dampens inflationary pressures … A new formula emerges from an economic model being developed by the Federal Reserve Bank of Dallas. It reveals something the traditional doctrine misses: Inflation varies inversely with growth not only in the domestic economy but also with growth in other countries…".

Also, one of the Bloomberg top stories last week was about how "Most Americans See Recession in the Next 12 Months." I channeled the Chair in my reply to it. See update 2 to the entry entitled "Expert Testimony" on Donald Luskin's blog.


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