Tag: Inflation
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The Unforeseen Consequences of a Shrinking Population
As someone born near the Baby Boom’s peak, I remember when many people worried that the world’s population was growing too fast. Today, however, the opposite is true. Birth rates have collapsed worldwide, and we now face the prospect of a shrinking population. Over two-thirds of the world’s population lives in countries with birth rates…
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The Latest Round of Inflation is Functionally Solved: Understanding the True Inflation Figure
The latest round of inflation is functionally solved and we are about two months away from achieving this, barring any exogenous shock to our economy. This is not a prophecy or unmitigated good news, but merely an observation about something that has already occurred and is widely misunderstood. The main reported figure, headline CPI data,…
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Why the Fed’s Pause on Interest Rate Hikes is a Mistake
When John Taylor, my colleague at the Hoover Institution, developed the Taylor rule for monetary policy, he evaluated the effectiveness of various inflation-fighting practices based on patterns observed over many years around the world. The Taylor rule is frequently cited by economists because it works. The rule is based on theory and evidence, and it…
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Is the Fed Making the Same Mistakes as in the 1970s with Inflation?
John Taylor, a colleague at the Hoover Institution, developed the Taylor rule for monetary policy by analyzing years of inflation-fighting around the world and evaluating the effectiveness of different practices. The rule is frequently cited by economists because it works. Based on theory and evidence, the Taylor rule tells us where the interest rate needs…
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The Latest Round of Inflation is Functionally Solved: What You Need to Know
The latest round of inflation is functionally solved and barring any exogenous shock to the economy, it should be fully resolved in about two months. This is not a prophecy, but rather an observation that is widely misunderstood. The headline CPI data, which is the main reported figure, is only catching up with the reality.…
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The Latest Round of Inflation is Functionally Solved: What You Need to Know
The latest round of inflation is functionally solved and barring any unforeseen economic shocks, we are only two months away from full resolution. While this is not a prophetic revelation, it is a widely misunderstood observation. The main reported figure, the headline CPI data, only recently caught up with the reality of the situation. The…
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The Taylor Rule and the Current Inflation Rate: Should the Fed Pause Interest Rate Increases?
When John Taylor created the Taylor rule for monetary policy, he was able to evaluate the effectiveness of different practices by looking back at years of inflation-fighting around the world. The Taylor rule is frequently cited by economists for its accuracy in determining where the interest rate needs to be to fight inflation. Currently, the…