On Saturday a Yellen ally and former adviser at the Fed delivered a provocative retort: the economic models underpinning those simple rules don’t work that well, and the best policy decisions come when central bankers look beyond those models to the unexpected forces shaping the economy.
Former Fed Chair Alan Greenspan famously did it in the 1990's when he argued against a rate hike at a time when rising productivity was holding down inflation, and arguably failed to do it when he ignored the impact of the tech and housing bubbles, Johns Hopkins University economics professor Jon Faust said in a paper presented at an annual Fed conference here.
In each case the point is the same: it was the extraordinary events outside of the basic inflation and output models used by central bankers that ultimately mattered most, argued Faust, who served as a special adviser to the Fed’s board of governors until September 2014.
Monday, August 31, 2015
Tuesday, August 18, 2015
Janet Yellen to skip Jackson Hole symposium this month
Janet Yellen and other Fed members are questioning with how to approach the September 2015 FOMC decision as the Fed Chairwoman won't be at the Jackson Hole symposium.
Dr Yellen revealed in late May that she was planning to skip the event. It's historically the place where central bankers set the agenda for the final four months of the year. But Yellen also skipped out last year and Bernanke snubbed it the year before. Most famously, it was at the conference where he laid the groundwork for QE2.
So far, we have little indication of who will be attending Jackson Hole. The program isn't released until August 27, the day the conference begins.
The theme this year is "Inflation Dynamics and Monetary Policy," which is well chosen because the lack of inflation is the critical question facing the Fed and almost every other central bank.
At the moment, the Fed calendar is very thin. There are speeches from Williams and Kocherlakota this week but nothing else on the schedule. Expect a few high profile names to leak onto the informal schedule next week.
Dr Yellen revealed in late May that she was planning to skip the event. It's historically the place where central bankers set the agenda for the final four months of the year. But Yellen also skipped out last year and Bernanke snubbed it the year before. Most famously, it was at the conference where he laid the groundwork for QE2.
So far, we have little indication of who will be attending Jackson Hole. The program isn't released until August 27, the day the conference begins.
The theme this year is "Inflation Dynamics and Monetary Policy," which is well chosen because the lack of inflation is the critical question facing the Fed and almost every other central bank.
At the moment, the Fed calendar is very thin. There are speeches from Williams and Kocherlakota this week but nothing else on the schedule. Expect a few high profile names to leak onto the informal schedule next week.
Subscribe to:
Posts (Atom)
