Weak lending may still be the culprit behind low inflation, but monetary aggregates may no longer closely track credit conditions.

The sale of typical securities would force the Fed to contract its lending programs, whereas the sale of Fed bills would not.

Inflation is seldom caused by lump-sum transfers but is often caused by higher government spending programs.

In order to maintain its credibility, however, the FOMC will have to take actions consistent with achieving its stated inflation objective.

Despite U.S. fiscal problems, the Fed appears to still retain excellent inflation credibility with financial markets… Although confidence in the Fed might explain the quiescence of inflation expectations, the structure of U.S. government debt may be more important… [I]nflating away the U.S....

Policymakers should not think of price stability and economic stability as competing objectives but as complements - the best way to achieve the latter is to be firmly committed to achieving the former.

Must the FOMC increase its target before inflation, or will inflation increase and cause the FOMC to increase its target?

Large-scale asset purchases may have limited power to raise TIPS-implied inflation expectations—something that might appeal to policymakers fighting deflation.

Fluctuations in the price of motor fuel (mainly gasoline) have caused most of the monthly noise and year-over-year fluctuations of headline CPI inflation over the past four years.