A change of pace for the Fed

caroline baum

Federal Reserve presidents Bill Poole and Bob Parry make waves

Two Federal Reserve policymakers broke ranks this month. St Louis Fed President Bill Poole and San Francisco Fed President Bob Parry offered some much-needed refinement to the Fed's standard line that policy can remain accommodative for a considerable period. Poole addressed the relationship between productivity and real rates in light of the possibility that underlying productivity growth has increased again - from 1.5% in the mid-1970s to mid-1990s, to 2.5% in the late 1990s, to something even higher today. If that is the case, "and if the FOMC does not make appropriate policy adjustme...