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The Fed's Commitment to Keep Inflation Down to Two Percent
The Fed has been very clear that their aim isn't to just keep raising interest rates forever until the economy falls into recession. Because of the beginning of a credit crisis, which I think they are averting, I think they have to conclude that they've achieved what they want to achieve. And if that's the case, then that will allow them to leave it at five percent for a while. If they keep going, then we will have the typical peak in the Fed funds rate and then a big drop in the Fed Funds Rate. But that I think would require a recession.