Thread by @modestproposal1

In light of current debate, this was certainly one of Yellen's most interesting speeches as Fed Chair. She posed the question:

"Are there circumstances in which changes in aggregate demand can have an appreciable, persistent effect on aggregate supply?"

federalreserve.gov/newsevents/spe…

I remember it well because she walked it back shortly thereafter, as if it was entirely too dangerous to even pose the question around running a high pressure economy while at the Fed. At the Treasury, tho...

https://twitter.com/modestproposal1/status/809123823450812416

She also made some interesting comments throughout 2018

https://twitter.com/modestproposal1/status/983144552042295296

Obviously we were in a very different economic environment back then, but TCJA was also obviously a much less impactful fiscal package, because corps weren't gonna change behavior and in dollar terms a meaningful chunk went to low MPC cohorts

https://twitter.com/NickTimiraos/status/1040701185345429504

The debate about "overheating" seems crazy when we are just exiting recession, after a decade long expansion that never got us back to prior trend.

And fears of non-linear or runaway inflation, is bizarre given the efficacy 2018's tightening campaign showed at slowing things.