Inflation expectations measures have bounced back –with energy prices they have bounced back, but they’re still relatively low compared to where they were in the middle of 2014, before oil prices started declining. So I kind of thought, if you wanted to see some numbers that you thought were kind of satisfactory measures of TIPS-based inflation compensation, I think summer of 2014 was the last time that we saw that. And then it had gone down, down, down, down, down, and now they’re come back up. But they really have not come back up to the previous level. So I think they’re still pretty low.
The last time – these talks I was giving in Asia, I was using this number that the 10-year TIPS inflation compensation, you know, was on the order of 1.6 (percent), but then you have to subtract 30 basis points off that to get to the PCE inflation expectation. So it’s only like 1.3 (percent) over the next 10 years. So that’s a pretty low – pretty low inflation expectation. And then – you know, and that’s without subtracting any kind of liquidity premium or risk premium or anything like that.
So I would say that they’re too low. And I’m one that has put more emphasis on that argument, probably, than others on the Committee. Others will cite survey measures. The Committee will often put survey-based things in the statement. I don’t think the survey-based measures move around in a way that is responsive to economic conditions. It’s just kind of like – (chuckles) – you ask people, they give you the same number month after month. So…