💯"Forward guidance" is widely misunderstood by the financial press and community broadly. As a policy, it is fundamentally about policy pre-commitment. It doesn't mean "communicating/forecasting (cont

FG was invented to deal with the economic problem of "non-credible commitment". After the GFC, the global economy was sagged by weak aggregate demand, debt overhang and the "paradox of thrift". The Fed faced a non-credibility problem that despite its forecast of easy po — via @stevehou

Corrects widespread misunderstanding of forward guidance as policy pre-commitment addressing non‑credible commitment.