Larry Summers, Harvard professor, economist, director of the National Economic Council under President Barack Obama and Secretary of the Treasury under President Bill Clinton, said the Federal Reserve was “disappearing” in an interview published Friday in Bloomberg Wall Street Week. Putting aside concerns about inflation in 2021, he talks about the environment and social justice and doesn’t think the Fed’s problems are fully resolved because his forecasts still show “some problematic groupthink”.
Summers said: “I think by 2021 our central bank will be out of the way. It’s about the environment. In many ways it is about social justice. He confidently dismissed fears of inflation as tentative and faulty in the fundamental workings of the central bank, including its tendency to overexpand rather than accept monetary policy, as our central bank does. So, I don’t think we’re asking too much from our central bank. But I think our central bank disappointed us a lot in 2021. And as a result, they are in a very, very difficult situation, at least lacking the credibility they once had with repeated bad predictions. ”
He continued, “And I must say that this is not a completely fixed thing. The latest scatterplot shows that even if inflation falls completely, unemployment will reach as high as 4.1%. This sounds pretty incredible to me. And the fact that the most pessimistic person on the 19-member Open Market Committee said 4.5% seems to me to indicate a very problematic groupthink.
Source: Breitbart
