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So what's happening instead is forced austerity in the deficit countries, not matched by expansionary policies elsewhere, in a low aggregate inflation environment — the ECB actually raised rates!
Aggregate inflation was uncomfortably high, global inflation had risen in recent months and headline and core inflation were likely to decline in 2008 and into 2009, Lockhart said.
Recurring to similar methodologies, both studies estimate monetary demand functions, aggregate inflation tax and seigniorage collection, and re-weight the consumer price index by quintile of the income distribution based on the 1987 Household Expenditure Survey.
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Despite the remarkably strong growth in monetary and credit aggregates, inflation around the world has been subdued.
They look at aggregate statistics — inflation, unemployment, the money supply — and figure out what the numbers mean for particular industries, such as autos or tech.
Probably, immigration flows played a crucial role in maintaining aggregate wage inflation at moderate levels.
Both believe in an activist Fed; both focus on the link between the pace of aggregate demand and inflation; and both prefer shifts in interest rates to be gradual and well-signalled.Neither man believes the central bank should be in the business of puncturing asset-price bubbles.
Macroeconomists typically think about the economy, without too much focus for specific sectors –measuring in terms of the aggregate "price level" (inflation), unemployment, demand and supply (GDP).
Yet Bernanke seems to possess some Keynesian baggage, using such nomenclature as "aggregate demand," "core inflation," "potential output" and "output gap," as though the economy were made up of interchangeable parts.
Economics can tell use how to stimulate aggregate demand, estimate inflation and predict GDP.
During this time, the central bank is powerless to offset the slump in aggregate demand and inflation induced by the cut in government spending.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com