FRED ADDS CRYPTOCURRENCY SERIES
A surprise move that caught my eye was from FRED. FRED is the online database that the St. Louis Fed uses to store data. Four cryptocurrency price trackers were added to the extensive database. Ethereum, Bitcoin, Litecoin, and Bitcoin Cash were added. The price history from the last four years is included. The data added to the database is courtesy of Coinbase, the cryptocurrency exchange that most Americans know.
Hopefully Coinbase will be out sooner, rather than later, because of the fraud they are involved with. It’s interesting to see that the Federal Reserve feels it is necessary to add these digital assets. Is it for a case study down the road for a crypto crash? Is it to provide “dot plots” for the future of money? Why does the Fed keep using the Phillips curve as a primary policy tool?
PHILLIPS CURVE
Fed officials have publicly mentioned the Phillips curve is not an adequate means for determining inflation. Studies by Philadelphia Fed Director of Research Michael Dotsey prove that point. If you pay attention to the government-sponsored unemployment rate, you expect a higher level of inflation.
The Phillips curve says that a low unemployment rate would spur aggregate demand, causing inflation. When unemployment hits 3.8% and inflation is still very low month-over-month, it makes the Phillips curve more like a unicorn, and unicorns exist in theory, but not in real life.
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