Friday, August 27, 2010

Plan B2

A rather different type of policy option, which has been proposed by a number of economists, would have the Committee increase its medium-term inflation goals above levels consistent with price stability. I see no support for this option on the FOMC. Conceivably, such a step might make sense in a situation in which a prolonged period of deflation had greatly weakened the confidence of the public in the ability of the central bank to achieve price stability, so that drastic measures were required to shift expectations. Also, in such a situation, higher inflation for a time, by compensating for the prior period of deflation, could help return the price level to what was expected by people who signed long-term contracts, such as debt contracts, before the deflation began.

See this is why Ben has gotten to the place he is today, he's always thinking ahead.

"Let's skull fuck the debtor class for a few years. Then, right as the country is on the brink of revolution, we'll switch it into hyper. Dude, I'm telling you, the People will love us."