Gold, Stocks & Forex

January 11, 2012

Greg Mankiw’s Blog: The Liquidity Trap may soon be over

Filed under: The Fed, Banks & Interest Rates,US & Canada — Colin Twiggs @ 8:21 pm EDT
Tags: ,

About a decade ago….. I estimated the following simple formula for setting the federal funds rate:

Federal funds rate = 8.5 + 1.4 Core inflation – Unemployment

….Eddy Elfenbein has recently replotted this equation. Here it is:

Fed Funds Rate compared to Mankiw Rule

via Greg Mankiw’s Blog: The Liquidity Trap may soon be over.

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