That´s because I still remember this 4 year old Scott Sumner post, where he talks about (his role model) George Warren:
FDR takes office in March, promising to boost wholesale prices back up to pre-Depression levels. He uses several tools, but the most effective was loosely based on Irving Fisher’s “compensated dollar plan.” Fisher’s plan was to raise the price of gold one percent each time the price level fell one percent. An obscure agricultural economist named George Warren was a big fan of Fisher’s idea, and sold it to FDR with all sorts of fancy charts.
And it worked.
Just like an “obscure Bentley U professor “ is “making waves” in 2013!
But the WSJ article was about “2013 Fed Voter ‘George Warns’ of Risks in Current Policy”.:
As she prepares to take on a direct role in setting monetary policy this year, the leader of the Federal Reserve Bank of Kansas City said Thursday she sees big risks associated with the aggressive course of action currently being taken by the central bank.
“We must not ignore the possibility that the low-interest rate policy may be creating incentives that lead to future financial imbalances,” Federal Reserve Bank of Kansas City President Esther George said. She added the central bank’s stance could ultimately “hamper attainment of the [Federal Open Market Committee‘s] 2 percent inflation goal in the future.”
It´s like a game of ‘musical chairs’; Lacker goes out and George comes in. Plus ça change…
Update: If she wants to learn about the inadequacies (or danger) of her IT obsession she would do well to read this simple and elegant Nick Rowe post:
The Bank of Canada has been very successful in keeping inflation on target. Which is what the Bank of Canada was supposed to do.
But keeping inflation on target has failed to prevent recessions caused by deficient aggregate demand. Which is what keeping inflation on target was supposed to do.
The problem is not the Bank of Canada. The problem is the Bank of Canada’s inflation target.