Fed’s Bullard: Asset Purchases Don’t Have Much Value Now

The transcript discusses the need to start tapering due to concerns about inflation and the potential need to raise interest rates sooner than expected. The speaker emphasizes the importance of optionality in economic policy for 2022, aiming to complete tapering by the end of the first quarter. They plan to assess economic conditions, including job reports, to determine if inflation is moderating. If inflation is not moderating, more aggressive policy actions may be necessary. The overall strategy is to phase out purchases and provide flexibility in 2022.

Why does the speaker believe tapering should start soon?

• Due to fears of prolonged inflation

• To increase employment rates

• To decrease market volatility

• To boost consumer spending

What is the significance of 'optionality' according to the speaker?

• It guarantees stable inflation rates

• It provides flexibility in decision-making

• It allows for fixed economic policies

• It ensures immediate rate hikes

By when does the speaker plan to complete the tapering process?

• Beginning of 2023

• Mid-2022

• End of the first quarter of 2022

• End of 2021

What will the speaker assess after completing the tapering?

• The changes in consumer behavior

• The state of the economy and inflation

• The effectiveness of new policies

• The impact on global markets

What might the speaker do if inflation does not moderate?

• Increase government spending

• Reduce interest rates

• Delay further economic assessments

• Implement more aggressive measures