I support everything, Mr. Chairman. I would have never guessed that this tautological balance of risk statement would outlast me. [Laughter]

Thank you, Mr. Chairman. I’ll let Tom respond on behalf of the Kansas City Royals. [Laughter]

This will be my 62nd and last statement at one of these meetings, and if you’ll bear with me I’d like to give a few parting thoughts before I ride off ...

Yes. I didn’t say it was heavy! [Laughter]

Sticker shock question: In the history of the world, has a country ever run a $1 trillion current account deficit?

Yes. [Laughter] Do I have to say? If somebody wants to comment, they can.

Well, that’s right. I understand that the link between interest rates and prices is weak. But really, there ought to be a full general equilibrium, if you will, calculation there. Affordability rates may tend to be a lot more stable than we would think just from interest rates alone ...

I have three quick points. On Sue’s point earlier about foreclosures, I think foreclosure rates nationally are too low to do anything with analytically. But in my world of low-income housing, in certain urban neighborhoods they get up to 40 percent or so. One can’t help but think ...

Just on that point, isn’t that the difference between the optimal policy and the Taylor rule? With the Taylor rule, you wait and see. In the optimal policy, you somehow know this so you can move earlier.

So if we see house prices going up, we’re in effect cutting the funds rate while the house prices are going up?

Okay. John, I have one question for you. How do we interpret the optimal policy? We, the policymakers, know all the shocks. So when we move the funds rate on the red line, is that to be interpreted as acting in advance of the house-price change, simultaneously with the house-price ...

Okay. Then it’s also a ratio. And the CPI tenant rent measure is for a constant unit over time. So what you try to do is to normalize on that?

So the share of land in the value is increasing. Is that extracted from your price-rent ratio in some way?

Well, one more question on the data. Josh, you need the share of land to do the price-rent ratio, don’t you? You adjust for improvements, but surely that’s only on the structure, not on the land.

I’ve got a few things to say, too.

Thank you, Mr. Chairman. First, I support your recommendation to move the funds rate up 25 basis points and to use the language of alternative B. In my remarks, I made some noise about combining some elements of alternative A; I’m not going to press that. Based on the ...

Thank you, Mr. Chairman. The short-run monetary choices are getting harder. While the world oil market is suffering a demand shock caused by rapid growth in China and elsewhere, it affects the economy as a supply shock, with simultaneous worsening of inflation and unemployment. Many of us lived through just ...

Thank you, Mr. Chairman. First off, I accept your recommendations in total, and I also apologize for making the point I made so late in the game. I wish I had been quicker to see the problem, and I would have said something earlier. But I accept the argument that ...

Whether we keep the sentence that Cathy talked about or not, we’d have the sentence that says pricing power is more evident. And then we’d go to “The Committee perceives that if the current target for the federal funds rate were maintained for the next few quarters, it ...

Could I make a friendly amendment, President Moskow? It is very dangerous to do this at the eleventh hour. I wish I’d gotten into this sooner, and I apologize for not doing so. But we could go down to the sentence in alternative C for the balance-of-risk statement, and ...

Let me ask you about your last few sentences. You said that if we use the alternative B version for the balance of risks, that limits its use in the future because if we ever say the risks are not balanced, then we’re confessing that policy is inappropriate in ...

Thank you, Mr. Chairman. I think I will be the fourteenth person to explain why the balance of risks is gradually changing. A few months ago, we were still worried about supposed soft spots but at this point the expansion looks pretty solid. Housing and consumption growth remain strong. The ...

No, I just wanted to ask about that issue.

May I get in on this one? Steve, didn’t your paper with Dan Sichel do that? I thought it did. I thought you had a little routine within multifactor productivity to do exactly what the Chairman was suggesting.

I nominate Timothy Geithner as Vice Chairman.

I nominate Alan Greenspan to be Chairman.

As long as we’re into this, what’s the problem? If we can release the February minutes in three weeks, why can’t we release today’s minutes in three weeks?

Yes. Let me take that a step further. What if we put something about this in our statement today?

I would support early release. I would do it unequivocally. Unlike Cathy, I don’t view this as something under the conservation of law and information here. So if we give out more information sooner, I don’t think we have to take anything back. In particular, I think the ...

The ship is sailing along, but I do think there’s an iceberg out there. Now, we may avoid it. I don’t want to say we’re going to hit it, but I do think one is out there.

Thank you, Mr. Chairman. I support your recommendation. However, if I could substitute my own analogy for change—

Thank you, Mr. Chairman. There has been much discussion lately of our measured pace. Are we slavishly raising the funds rate 25 points per meeting or following some other strategy? Frankly, it is hard to think about this question without knowing where we are ultimately going. Many seem to feel ...

Right. So I’m for B′— the statement that was passed out. But I agree with some combination of the views expressed by Janet, Cathy, and you that soon we should change this sentence that says, with inflation expected to be low, “the Committee believes that policy accommodation can be ...

Oh, they’re putting in a reference to the cumulative increase.

Thank you, Mr. Chairman. I agree with your recommendation in all parts. I’m madly looking around for the sentence that Janet is referring to, and I can’t find it.

Thank you, Mr. Chairman. A standard forecast today, well represented by the Greenbook baseline, assumes a minimal decline in the dollar and something close to projected current policy for the federal budget. It has the funds rate rising by roughly half as much as is suggested by the fed funds ...

I support it, too—even though you didn’t care! [Laughter]

Thank you, Mr. Chairman. The news that we have to deal with for this meeting relates to the mysterious soft spot that is affecting or trapping the economy. We’ve had soft spots before, blamed variously on the hangovers from the 1990s, the Iraq War, Enron, and Sarbanes–Oxley. Let ...

Right. That’s an obvious problem. But the other problem is that we have to get more demand stimulation in the rest of the world. And as Karen just mentioned, the zero-bound issue really gets in the way of that. We talked a little last week about fiscal expansion, and ...

Just on this point. I think I cannot be accused of going on my merry way on this particular issue. But as a result of the discussion that Karen led last meeting, I’m actually more pessimistic about the demand switching—I believe that’s what it’s called in ...

Thank you, Mr. Chairman. Number one, I support your approach. I agree also with the notion that, at least this time, we should not fiddle with this statement very much. We are on track to have a more thorough discussion of the language in our statements in the near future ...

Thank you, Mr. Chairman. I normally speak after the break, so I was intending to pass out a chart.2 Let me quickly do that. Just when it looked as though everything was on track for a gradual tightening of policy, an energy shock seems to have hit the economy ...

I’m just trying to caution everyone not to think that the balance of risks formulation is going to be a panacea because it really wasn’t before and I don’t think it will be now.

We may be headed there, but remember this: When we had all of these working groups that Roger chaired regarding language to describe the balance of risks, we had very difficult problems shaping that into clear communication. First, we have an issue that we’ll never resolve on exactly what ...

Thank you, Mr. Chairman. I read from the polls and the market surveys that it is a “slam dunk” or, to use another analogy that has been in the news lately, a “gimme putt” that the Fed will start raising rates at this meeting. That issue seems hardly worth discussing ...

I, too, thought the presentation by the staff was very good this morning. I must say, as one who is going to talk about similar things in my own remarks, mine is going to sound a little lame in comparison! But there was one issue that you didn’t talk ...

We’ve got a budding politician here! [Laughter]

Yes.

If they didn’t hit the zero bound, your scenario 1 line wouldn’t go much below zero, would it?

Well, I’m sure I’ll get an answer. Actually, I’m not sure I have totally grasped all this. In looking at your exhibit 1, suppose the dollar changes a lot. There are three ramifications on industry that you’ve highlighted. One is that the costs go up, and ...

As long as I have the floor, could I ask Linda a question as well?