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The concern is that if the Fed does not raise interest rates quickly enough, wages and prices could begin to spiral up, forcing a sharp rate increase that could push the economy into recession.
Over the long term, it could turn out that greater national debt does not raise interest rates, assuming investors around the world remain willing to lend the government money at rates close to zero.
Mr. McCulley says the period -- or "interregnum" -- of rising prices and slowing growth should not last long, provided that the Fed does not raise interest rates too much and cause a recession.
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This amounts to a monetary tightening, even if the Fed doesn't raise interest rates directly — and there's a lot of pressure on Mr. Bernanke to do that too.
But the Federal Reserve's policy makers do not raise interest rates in a vacuum.
Testifying before the Financial Crisis Inquiry Commission in 2010, the Fed chairman, Ben S. Bernanke, explained why, in the middle of the last decade, the central bank did not raise interest rates to stifle what appeared to be an overheating housing market.
The law was put in place after criticism that the bank, overly influenced by government euphoria in booming eighties, did not raise interest rates quickly enough, letting the asset bubble grow to huge proportions before it burst in 1990.
However, with the economy looking hale real GDP grew by 3.8% in the year to the first quarter—such concerns now look overdone.If the Bank of Japan did not raise interest rates next week, financial markets would now be surprised; if it did not raise them in August, they would be shocked.
Our interpretation of this finding is that even authors that are socially well connected will have papers that are not highly cited, simply because their content did not raise interest in the scientific community.
Due to the AEC engines the Vanaja's did not raise interest among the potential Greek customers, as relations between the UK and Greece were bad at the time.
Unemployment had just dropped below 6percentt and economists, including liberal ones, were warning that inflation was just around the corner if the Fed did not raise interest rates to cool the expansion.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com