An improvement in this direction: the Fed has just acknowledged, at least, that it is possible for inflation to be too low as well as too high, that inflation targeting needs to acknowledge that the US has been consistently undershooting its goal, and that this leads to the further feedback of the market expecting the US to continue undershooting its goal. And then it explains and commits to average inflation targeting:
We have also made important changes with regard to the price-stability side of our mandate. Our longer-run goal continues to be an inflation rate of 2 percent. Our statement emphasizes that our actions to achieve both sides of our dual mandate will be most effective if longer-term inflation expectations remain well anchored at 2 percent. However, if inflation runs below 2 percent following economic downturns but never moves above 2 percent even when the economy is strong, then, over time, inflation will average less than 2 percent. Households and businesses will come to expect this result, meaning that inflation expectations would tend to move below our inflation goal and pull realized inflation down. To prevent this outcome and the adverse dynamics that could ensue, our new statement indicates that we will seek to achieve inflation that averages 2 percent over time. Therefore, following periods when inflation has been running below 2 percent, appropriate monetary policy will likely aim to achieve inflation moderately above 2 percent for some time.
Of course, this say nothing about how they intend to achieve this—seigniorage has its downsides—but I expect Eliezer would see it as good news.
An improvement in this direction: the Fed has just acknowledged, at least, that it is possible for inflation to be too low as well as too high, that inflation targeting needs to acknowledge that the US has been consistently undershooting its goal, and that this leads to the further feedback of the market expecting the US to continue undershooting its goal. And then it explains and commits to average inflation targeting:
Of course, this say nothing about how they intend to achieve this—seigniorage has its downsides—but I expect Eliezer would see it as good news.