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Marcus Nunes's avatar

Originally, it was just AIT. The "F" was appended later, maybe to enable the Fed to fudge the concept. Anyway, at the time I thought the concept was DOA!

https://thefaintofheart.wordpress.com/2020/10/09/is-the-new-monetary-policy-framework-ait-an-improvement/

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Thomas L. Hutcheson's avatar

I agree with your criticisms of AIT given your interpretation. But, a) I do not think it is or needs to be based on the believe in a Phillips curve and b) It don't this it has or should have anything to do with the idea of a ZLB.

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Thomas L. Hutcheson's avatar

But well appended. We do not want the Fed to chug along trying to achieve 2% inflation when there are extraordinary shocks like COVID recovery.

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