Correspondent, Chicago
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May 30, 2014
May 30, 2014
May 30, 2014
May 29, 2014
May 29, 2014
May 29, 2014

U.S. Fed can’t fight inflation on its own, economist says

By Ann Saphir

PALO ALTO Calif. (Reuters) – The U.S. Federal Reserve does not have the power to fight inflation on its own, a prominent economist said on Thursday, a conclusion that challenges the very bedrock of current Fed thinking.

“Inflation is always and everywhere a fiscal problem,” declared John Cochrane, a professor at the University of Chicago, speaking at Stanford University’s Hoover Institution. “Long-run price stability is a function of the structure of government debt, fiscal promises, and fiscal commitments. The central bank has only a short-run smoothing role, as it did under the gold standard.”

May 29, 2014
May 29, 2014
May 29, 2014
May 29, 2014
    • About Ann

      "Coverage includes Federal Reserve regional banks, U.S. monetary policy, interest-rate futures markets, and financial exchanges and clearinghouses serving the derivatives marketplace, including CME Group."
      Joined Reuters:
      2010
      Languages:
      English, Japanese
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