My bottom line is that monetary policy should react to rising prices for houses or other assets only insofar as they affect the central bank's goal variables - output, employment, and inflation.

I would be strongly committed to working with the FOMC to continue promoting a robust economic recovery ... I consider it imperative that we do what we can to promote a very strong recovery.

Individuals out of work for an extended period can become less employable as they lose the specific skills acquired in their previous jobs and also lose the habits needed to hold down any job.

My bottom line is that monetary policy should react to rising prices for houses or other assets only insofar as they affect the central bank's goal variables - output, employment, and inflation.

Will capitalist economies operate at full employment in the absence of routine intervention? Certainly not.

Firms don't just try to pay as little as possible to get the needed bodies on board; when there is unemployment, they ask themselves how wage cuts would affect the behavior of the employees. Would they quit or feel dissatisfied and work less hard on the firm's behalf if they feel that wage policies are unfair?

To me, a wise and humane policy is occasionally to let inflation rise even when inflation is running above target.