American elites have completely failed to understand what the Fed should be doing right now

By Jared Bernstein

Here are a few questions I’d like you to consider, and you don’t need to be an economist to give a valid responses. In fact, it’s better if you’re not.

Which do you think is a bigger problem facing the U.S. economy right now: a) inflation, or b) unemployment? Do you think wages are growing: a) too quickly, or b) too slowly? Which is the bigger threat to the economy: a) that it overheats, or b) is undercooked?

I’m going to make the bold assumption that most of you answered “b” on all of the above. And in a moment, I’ll provide the data to confirm your gut. What’s unsettling, and in need of explanation, is why so many influential voices, from the punditry to the markets, answer “a.”