Federal Reserve Bank of Philidelphia president Charles Plosser spoke at an annual breakfast conference today with wise words about analyzing the economy.

Money quote:

When households, firms, and markets have a better understanding of what to expect from monetary policy, they can make better financial plans and spending decisions. Thus, greater clarity helps monetary policy become more effective at promoting its congressionally mandated goals of price stability, maximum employment, and moderate long-term interest rates.


Plosser has been vocal in his dislike of continuing depressed interest rates through to 2014. He makes several good points overall, and admits the fallibility of economic projection. I am happy to have a sceptic on the board, even if I don’t necessarily hold his views.