How Worried Should the Fed Be About Inflation?

The video discusses concerns about low inflation and the end of quantitative easing. It analyzes inflation expectations through Treasury notes and bonds, and examines the Personal Consumption Expenditures Index, the Fed's preferred inflation measure, which has been below 2% for 28 months. The impact of crude oil prices, which have dropped significantly, is also considered. The Fed acknowledges the risk of persistent low inflation but believes it has diminished. Viewers are encouraged to monitor these inflation gauges to understand future trends.

What is the main concern raised at the beginning of the discussion on inflation?

• The risk of deflation

• The end of quantitative easing

• The potential for high inflation

• The impact of inflation on employment

How is inflation expectation measured in the first chart?

• By comparing the stock market index

• By analyzing the unemployment rate

• By the yield differences between Treasury notes and inflation-linked bonds

• By the consumer price index

What is the Fed's preferred measure of inflation?

• Consumer Price Index

• Personal Consumption Expenditures Index

• Producer Price Index

• Gross Domestic Product Deflator

What has been the trend in crude oil prices since June?

• Increased by 24%

• Increased by 10%

• Decreased by 24%

• Remained stable

What does the Fed say about the risk of inflation remaining below 2%?

• It is no longer a concern

• It remains unchanged

• It has diminished somewhat

• It has increased significantly