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Inflation Target
- Inflation worries exist, with concerns about returning to high levels like in the 1960s.
- Ultimately, inflation will reach the Fed's target rate of around 2 percent.
Disinflation Strategy
- Inflation is sticky around its current level.
- "Opportunistic disinflation" might occur, waiting for the next recession to lower it further.
Debt and Deficit Impact
- High debt and deficit make the Fed's job harder, exceeding 100% of GDP.
- The US can delay consequences due to its reserve currency status.