A Quote by Ben Bernanke
Although low inflation is generally good, inflation that is too low can pose risks to the economy - especially when the economy is struggling.
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Central bankers always try to avoid their last big mistake. So every time there's the threat of a contraction in the economy, they'll over stimulate the economy, by printing too much money. The result will be a rising roller coaster of inflation, with each high and low being higher than the preceding one.
Near-zero policy rates that may be considerably expansionary in an economy with high inflation could be contractionary when inflation is too close to zero, or worse, deflation has set in.
The government will always tell you that it wants low inflation. The real issue is the horizon over which to bring inflation down.
The single biggest issue that I'm very sensitive to is inflation. I'm very concerned that this extended period where the interest rates were quite low and stimulated a lot of activity could breed inflation and create a problem for us.
An overheating economy, characterized by accelerating inflation and rising interest rates, is another precondition for recession. This doesn't describe today's economy.
I think it's time we had a President who will provide the only real economic security: good jobs. A President who will provide middle class payroll tax relief to get money in the pockets of workers who will spend it, not more tax giveaways for those at the top to stimulate the economy in the Cayman Islands and Bermuda. A President who will index the minimum wage to inflation and raise it from a 30 year low, not increase the tax burden on the middle class and those struggling to join it.
Once an economy reaches a certain level of acceleration... the Fed is no longer with you... The Fed, instead of trying to get the economy moving, reverts to acting like the central bankers they are and starts worrying about inflation and things getting too hot.
I work with the macro economy, which involves the major variables that measure the health of the whole economy, such as total consumption, investment, income, employment, and inflation.
Because food and energy prices are volatile, it is often helpful to look at inflation excluding those two categories - known as core inflation - which is typically a better indicator of future overall inflation than recent readings of headline inflation.
If you look around the world and see all the different countries struggling to get away from very low inflation rates with economies not nearly as strong as ours, you want to make sure we avoid those circumstances.
A very complicated mass of things influences the economy - the speculative effect, government policy, consumer borrowing and spending, the level of technical innovation (which I concede, although everyone emphasizes it too much), and much more - including, of course, the rate of inflation.
The most important thing to remember is that inflation is not an act of God, that inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy.
Here at home, ... while the most likely scenario remains solid growth and low inflation -- subject to the usual ups and downs -- certain sectors have been impacted by the crisis, some because of increased imports and others because of decreased exports. Moreover, problems in the global economy do constitute a risk to all our overall economic well-being.
One of the arguments I make for the failure of the euro is that, at the time it was being constructed, there was a 'neo-liberal' ideology which said that all we need to do to make this thing work is to get deficits low, keep inflation low, and take down barriers, and then everything would be fine.
If we don't embrace a low carbon economy this decade, it won't just harm the planet, but also the U.S. economy.
Mr. Greenspan did a very good job in the early 1990's. But recently he's fallen prey to this crazy theory that prosperity causes inflation. So they're trying to slow the economy down by raising interest rates. It's like a doctor saying you're in great health, so we have to make you sick a little bit. It's a bizarre theory. It's going to hurt our economy.
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