Recent quotes:

Today's Must-Must Read: Greg Ip: Hard Decisions on Easy Money: Growth Now or Turmoil Later? - Washington Center for Equitable Growth

The Federal Reserve is getting what it wanted from six years of near-zero interest rates and trillions of dollars of bond buying: unemployment approaching levels often thought of as “full employment.”… …It’s also getting some less savory side effects. Asset prices are sky high, fueling fears of a chaotic reversal that could hammer the economy as wealth evaporates and credit dries up. This leaves Fed officials conflicted as they weigh when to lift interest rates…. Given the harm past crises have inflicted, maintaining financial stability is hardly at odds with full employment. At some point, financial stability may be a reason for the Fed to tighten. That point is still some ways off. Raising interest rates now trades tangible harm for intangible benefits. Only once the economy can safely withstand higher rates and the associated turmoil will such a trade-off make sense…. Market turmoil is unpleasant but rarely threatens the economy…. Interest rates today may not in fact be artificially low. Global forces such as excessive saving, low inflation and low investment are also at work. This is why markets have priced in a lower path of Fed tightening than the Fed itself seems to contemplate…. The Fed should not be under any illusions: holding rates at current levels raises the odds of future turmoil. For now, those odds aren’t high enough to sacrifice some growth.
#Greg-Ip - equitablegrowth.org

Morning Must-Read: Greg Ip: How Europe’s Easy Monetary Policy Crossed the Atlantic - Washington Center for Equitable Growth

Central banks always seek to set the overall level of financial conditions which are a combination of short and long-term interest rates, equity prices and currencies, but they don’t get to choose the contribution of each. Faced with a stronger currency, the natural response is to lower interest rates in hopes of achieving the same economic goals with a different mix of instruments. Don’t call it a currency war. Call it textbook economics.
#Greg-Ip - equitablegrowth.org