Tuesday, December 20, 2016

WSJ advocates permanent sicialism

WSJ: After extraordinary actions by the Federal Reserve during and following the Great Recession, including quantitative easing programs and record low interest rates, some economists are calling for the Federal Open Market Committee to mechanically follow a simple rule in conducting monetary policy. As a regional Fed bank president and member of the FOMC, I believe this would unduly limit the Fed’s policy tools and ultimately harm the economy and in turn employment.The idea is to effectively turn monetary policy over to a computer, rather than continue to let Fed policy makers use their best judgment to consider a wide range of data and economic trends. The classic example of such a rule is the one proposed by Stanford economist John Taylor more than 20 years ago. The “Taylor rule,” as it’s widely known, calculates a desired level for the federal-funds rate based on measures of inflation and economic output.My staff at the Minneapolis Fed has estimated that if the FOMC had followed the Taylor rule over the past five years, 2.5 million more Americans would be out of work today. How many people is that? It’s enough to fill all 31 NFL stadiums at the same time, almost 6,000 more people out of work in every congressional district.
Horse manure.  WSJ is protecting the debt cartel, and its own position.  Bankerr bot marks to market as necessary, the Swamp will be fairly priced.

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