Sunday, January 20, 2013

Lacker (2): Bullard

In a PDF from a year back, Federal Reserve Bank President James Bullard wrote:

During the 1970s, U.S. inflation eventually rose to double-digit levels, and this was accompanied by especially poor macroeconomic performance on the real side of the economy.

Yeah, that's what I thought too. But take another look at Marcus's graph:

Graph #1, source: Marcus Nunes

The years of high inflation show the best "real side" growth, well above trend.

Related post: Lacker

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