Mary Daly

We can't know ex ante before the data come out and before we get that information really what we're facing.

We just have to have an open mind about which one it could be and maybe other periods of history I didn't even mention.

Well, you know, there's many nuanced ways it could affect the neutral rate, but I can back up from that and just ask what were the policy remedies.

If you think we're about to have an inflation run up, then we obviously would have to hold policy tighter for longer because we wouldn't want that to occur.

You know, honestly, Americans have endured.

you know, already too much inflation, and we really need to get that back down to 2% to restore price stability as we've committed to.

On the other side, if it's productivity, you would start seeing the economy be able to run a little bit longer.

Maybe if you go back to the debates of the 90s, you know, we saw the labor market slow.

Workers were insecure, but the labor market had unemployment that was fairly low, and many at the time were worried that could spur inflation.

But

Greenspan, Chairman Greenspan held on with his colleagues.

They didn't raise rates.

And what you saw was, you know, the 90s, which was a booming time.

And we ended around target inflation and we had a productivity boom.

So you're trying to balance those two things together.

And it means not looking just at headline information, but getting below that information, talking to firms, talking to consumers, talking to workers, really on the ground work like we do at the reserve banks and other places.

You know, the Fed is built to do this on the ground work as well as look

the published data.

Well, you know, right now, you know, I'm in the West.

I have the nine states in the western United States.