The Political Costs of the Recession

When an inter straits get to zero, one of the tools that you still have is to try to affect people's expectations of inflation. And so i think benanke was taking a number of steps. For example, at this time, they started giving out something that's close to a target for what they were aiming for for the inflation rate. I remember trying to explain that that was probably a good thing because we were in a world where with unemployment at ten per cent, people might be starting to expect inflation to come down. If the fet is is signalling, no, we're going to keep it at least at two per cent, that connet would be very positive....