I truly wonder how economically detached the Obama Administration itself and its advisers are from real world economics. Massive national debt that soon will not be able to be financed, a massive unemployment rate of 17%, massive tax increases, massive socialized health care, states bankrupt and the list goes on.
Janet Yellen is the newest debacle forming for this economically illiterate bunch. Yellen is being appointed as the Federal Reserve Vice Chairperson. Yellen is currently President of the San Francisco Fed and has some strong economist theories. However she believes in the Phillips Curve trade-off between inflation and unemployment. This means that we are constantly giving up one for the other in our economy. These theorists believe that due to America's economic prosperity and due to too many people working we have inflation. I disagree with this theory (even though I must touch upon Phillips in my classes), economic prosperity should be the goal of any economic policy. Let the supply side do its own thing and create, fuel and extend economic growth through investments, capital gains and dividends. This is what creates jobs in our economy, not a handful of political patronage government jobs that provide no productivity nor provide any growth in GDP.
Yellen and her theories will be a boom for inflation and will help to keep our unemployment rates high for the coming future in my economic opinion. I no longer understand what the Fed's policies are in 2010. It just furthers the economic illiteracy this administration shows the educated American public.