Former Fed Governor Warsh: Danger of Fed as a Science

The video discusses economic measurement, particularly inflation, and critiques the Fed's reliance on economic models. It highlights the impact of dollar appreciation on policy and the global influence of the Fed's decisions. The video also examines the Fed's communication strategy and its credibility with markets.

What does the Harvard Professor believe about the current measurement of inflation?

• It underestimates economic performance and overestimates inflation.

• It is accurate and reliable.

• It has no impact on economic policy.

• It overestimates economic performance and underestimates inflation.

What is the perceived impact of the dollar's appreciation according to the Fed's communication?

• It strengthens the global economy.

• It is equivalent to a 200 basis point hike.

• It has no significant impact.

• It weakens the US economy.

How has the Fed's focus shifted in recent years?

• From short-term to long-term policies.

• From interest rates to currency manipulation.

• From domestic factors to global risks.

• From global risks to domestic factors.

What is a fan chart used to indicate in economic communication?

• Precise predictions of economic outcomes.

• A lack of certainty and precision.

• The exact interest rate changes.

• The future value of the dollar.

What lesson did the Fed learn during the financial crisis regarding market influence?

• They should increase their communication.

• They need to listen more to market signals.

• They should avoid influencing markets.

• They can control markets in any direction.