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

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.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s