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Fed shouldn't mechanically follow policy rules: Yellen. Should traders?
The testimony is always fun to watch. It pays to stir the pot if you are a politician especially when speaking to a Fed chair. Heck, they really don't have control over what the Fed does. I personally think that is a good thing. So the question was asked "What would the world have to look like to apply a rules based approach to conducting monetary policy?" It is these questions which make you want to fire back, "What would the world have to look like to balance a budget?" but that aside, the answer was ultimately answered with the following: "The Fed shouldn't mechanically follow policy rules". And this was the ... (full story)