Janet raised IOER in 2015

 Inflation Dynamics and Monetary Policy

This is her speech above for doing so. She says that inflation expectations were well anchored and any local deflation spikes were temporary.

At the time she actually raised rats because the one year Treasury had started rising. She wants to keep her deposits, at least some of them. She wanted to get out of the remit business, and wanted more tax dodging from the Swift banks (more deposits). And she had the dual obligation of keeping government liquid.

Are expectations for inflation well anchored? No. Her chart is not complete, and oil prices had just crashed from 105 to 30, a sudden, massive deflation spike, caused mainly by the rush to the dollar for whatever reason, probably by the Opec. 

None of this makes sense, the only thing that makes sense is that the one year was rising and government needed to stay liquid and the Fed wants out of the remit business. So they raised deposit rates to keep the remit stream stable and dropping.

Everyone is avoiding taxes, at the moment. We are all finding escape paths. It is that time.

Janet's point at Treasury is simple, she knows that having Swift banks collect remits is horse shit, she want that shifted to a Treasury inflation tax. She is on the side of the bankers union, a good union soldier. So is Powell.

Much of what we hear is in institutional language, semantics with sharp boundaries. S they cannot speak plainly, Janet cannot say, "hey this crap is unfair to Swift". They cannot say inflation tax.  Anything that might cause sudden stop is shoveled over to the 'long run'. Any point proven with a suitably fake 'expectations' operator. It is a mix of law and slight of hand. 

The 2 percent ex post uncovered cost of unbalanced government. That it what is anchored. More of that imbalance known hedged with set aside. Business knows that their government costs are not completely hedged. But if you ask them, "How much unanticipated costs from government do you expect?" He will answer with the amount of price hikes he needs next year.

Government imbalance losses are a  little over one percent, Kevin Drum thinks it is closer to fifth of a  percent. I voted for two percent, I am an anarchist. The anchored expectation now is that government has short changed us about one point, or less. We got the Swamp better hedged then ever.