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The Fed: Challenged with Keeping Both Inflation and Unemployment Low

Market Watch reports  “Like it or not, in the short run there is a trade-off between unemployment and inflation. To keep inflation low, you need high unemployment; if you favor low unemployment you have to accept high inflation.”

Check out this informative article by Irwin Keliner, Market Watch’s chief economist, about how the Fed works and the challenges its balancing in today’s economic environment.

We’d love to hear your comments below. Given this bit of chicken and egg syndrome, which do scenario do you favor?  Higher unemployment or higher inflation?  Which do you think will get our economy back on track the fastest?

 
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