As if investors don't already have enough to think about when it comes to the Fed, Chair Janet Yellen has sent minds reeling again with a relatively new addition to the monetary policy lexicon.
In an otherwise-academic speech delivered this month at the Boston Fed, Yellen pondered the concept of running a "high-pressure economy." It's a nice-sounding phrase at a time when the economy has been a far cry from energetic.
But for some, notably including several Fed officials, the concept carries darker undertones. They worry that the central bank may be on a course that could make the next downturn worse, wherein it allows the economy to heat up too much, then has to rush to correct course. Others, though, think there's more at play — and it could be monetary politics.
"I think it's risky," said Jim Paulsen, chief investment strategist at Wells Capital Management. "One of the things that scares me in general about where we're at with interest rates is it seems everyone has accepted the lower-for-longer (position), including the Federal Reserve. When there's that big a consensus on anything, it always frightens me."