Today Bullard comes out of the closet with a euphemism:
The Federal Reserve should consider new policy options, including directly targeting a non-inflation-adjusted level of economic growth, after more than six years of sustained monetary easing failed to spur a boom, Federal Reserve Bank of St. Louis PresidentJames Bullard said Thursday.
“It’s time to question the current theory and explore other models about what’s going on at the zero lower bound,” Mr. Bullard said, referring to the Fed’s zero-rates policy that has been in place since December 2008.
Mr. Bullard was presenting new research conducted with three other economiststhat he says shows “the monetary authority may credibly promise to increase the price level…to maintain a smoothly functioning credit market.”
The model could be “broadly viewed as a version of nominal GDP targeting,” the paper says, referring to a policy in which a central bank would set a target for gross domestic product growth without an inflation adjustment. The idea would be to signal to markets and the public that the Fed is serious about generating a recovery, thereby spurring investment and spending.