Thursday, September 28, 2017

SF Federal Reserve President Calls for Higher Inflation Targets

Central banks around the world should consider co-operating and co-ordinating efforts to change their 2% inflation targets, John Williams, president of the Federal Reserve Bank of San Francisco, told the Central Banking journal.

Williams believes 2% price inflation targets adopted by most of
the developed world’s central banks will prove to be "suboptimal" over the next 10 years.

“There could be a mutual benefit for countries to change their price-stability policies together,” says Williams in the in-depth interview, published on September 27.

Williams didn't name a new specific target range in the interview but Central Banking had this to say:
One way to avoid resorting to unconventional policies so much in the future is for central banks to consider raising their inflation targets – perhaps to 4%...
The idea of targeting price inflation at any level is a bizarre concept co-opted by Keynesians in their unending desire to manipulate the economy. The first 2% inflation target, itself, was picked pretty much out of thin air with the help a New Zeland kiwi farmer--when New Zeland bankers wanted to keep monetary policy away from political influence.

 A target of 4% would most assuredly result in an overshoot of the rate and mad convulsions in the economy. But Williams knows it is all about printing money for The Man.



  1. We have the continuing Austrian/libertarian failure of getting average people to understand that inflation is a purposeful government program and not a unfathomable, mysterious and inevitable force of nature. ABCT or any anti-fed analysis will be meaningless until then.