According to some, the saying "everybody complains about the weather, but nobody ever does anything about it" could be just as easily applied to the consumer price index. But what should be done?

The FOMC’s “mandate-consistent inflation rate” is generally judged to be “about 2 percent or a bit below.”

Despite pockets of strength, the U.S. economy continues to struggle to build consistent momentum. Real GDP growth rebounded in the first quarter of 2013 after ending 2012 on a relatively weak note.

Decision makers, both public and private, use forecasts of economic growth and inflation to make plans and implement policies. In many situations, reasonably good forecasts can be made with simple rules of thumb that are extrapolations of a single data series. In principle, information about...