With some econ my best guess is rates will normalize higher. I wont guess where that is or how long or why it would change.
I will say as long as the effective tax rate is not very high interest rates will be nominally higher than in the 1950s. This by design is better than what was set up going forward after the 1950s.
That does not answer your question directly but goes to what is cooking currently.
May be both of you are right…just some differences in the words 
how about this: Powell says the Fed are steadfast in their aim to bring inflation to their target of 2% and do whatever it takes to get there…
Whether they will pause, raise or cut depends on data…And anything can happen between now and then.
You sure enough did miss it. Take my word for it. I don’t feel like spending the time digging through all of Powell’s speeches…again.
Wendy
@mostlylong Powell, the FED, definitely have the 2% target for inflation.
My only opinion of the FED’s position is what we came from zero percent rates is not what we will revert back to not by a very long shot. So when Powell mentions not lowering rates till…the context in early 2023 is very different than the context in early 2025.
Well, if the Fed has said it many times, it shouldn’t be difficult to find an example and I haven’t see one.
The Fed’s and Powell’s statements are nuanced. They have not said, in the last few years, something as specific as “inflation needs to get to a specific number (y%) before the Fed will take a specific action (raise, pause, cut).”
For example, on May 3 Powell said “Since early last year, we have raised interest rates by a total of 5 percentage points in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time.”
This is not the same as the statement you claim. The Fed is much less specific.
All they say is rates will be restrictive (which could be many Fed funds rate scenarios) so that inflation eventually reaches 2%, but nothing about what the path of the Fed funds rate will be when/if inflation gets to 2% or what the Fed funds rate itself will be when/if inflation reaches 2%.
On May 3, Powell was specifically asked about rates cuts, and he said nothing as specific as what you wrote above.
You’re right, especially since it doesn’t take too much time to find this out all by oneself. Just one such quote is at: When Will The Fed Stop Raising Rates? | Bankrate
“Policy has got to be tight enough to bring inflation down to 2 percent over time,” Powell said. “It doesn’t all have to come from rate hikes. It can come from tighter credit conditions. It’s highly uncertain how long the situation will be sustained or how.”
Sometimes google actually is your friend.
Pete
Yep easy to find. I do not like digging for others either. The conversation gets bogged down if someone who rarely follows along wants someone else to prove facts. Especially when economics is more feel for many variables than the targets etc…that of course leaves people who have no feel for econ acting as if they believe nothing. That is only on them. No one else is responsible for their lackings.
Google is our friend in all of these instances. Plus you can get a good public finance textbook and try to educate yourself.
Or here.
“We’re not considering that. We’re not going to consider that. Under any circumstances,” Powell said. “We’re going to keep our inflation target at 2%. We’re going to use our tools to get inflation back to 2%,” he said, although he allowed “there may be a longer-run project” that could take a fresh look at the central bank’s inflation goal.
Andy
In other words if the IRA and other infrastructure expenditures create economies of scale in manufacturing then there will be a deflationary force from our economy and Mexico’s where the inflation targets can get resolved.
Note not only is the IRA not on the chopping block in the debt ceiling deal but the main thing offered in the debt ceiling talks is a new law giving the executive power to implement a green energy smart grid nationally. My own take much of the savings in the deal will go over the next several years into that grid. It is an absolutely necessity no matter how ignorant any of the readers have been.
Yes, Powell did say that the Fed plans to keep the fed funds rate at a level that maintains the 2% target for an “extended period” to avoid the rebound that was seen in the 1970s.
Once the Fed is convinced that inflation has stabilized, Powell said that they intend to bring the fed funds rate to a “neutral” rate that neither stimulates nor slows the economy. There was a recent Fed study that spit out a neutral rate of 0.7% but that’s just from a model and not a Fed policy statement.
Wendy
All of this, the neutral rate, will be considering the relationship of monetary policy to fiscal policy. The last 40 years of supply side econ will be no guide at all.
Any model claiming 0.7% is backward looking to build the model.
Fiscal policy will be somewhat inflationary. The rate will keep that in check. The fiscal policy not the monetary policy will be expansive of the GDP. As the FED is saying their policy will be neutral.
Here is CNBC “history” of 2% as the “target”.
FWIW.
Bing GPT is my friend.
ralph doing his part to bring competition to Google.
This is fascinating. This is on our dynamics in the US economically. The window was 14 years ago. WEB is the most profound and he is at his absolute best in age looking back across American history.
This also means shallower recessions. The FED is not “incidentally” causing deeper recessions unlike the supply side period.
Ok Leap, now you are arguing against yourself? I call foul. 
Andy
Just not on Sundays!!!
In my 30s I knew a homeless man who was in with Rand and Greenspan in NYC back in the day. He used to call all the econ stuff, but with me in reach, rubber thinking. He was contending you can not have rubber thinking. He was homeless mind you and thought a broke drama writer knew it all.
To be honest Andy like Mark Twain would recommend I am not trying to find any merit in your humor or any moral or spiritual principle. True to humor there is nothing to understand here.
I know what will happen in this debt ceiling crisis
Markets may rise…or they may fall…or they stay flat
This graph is all over the place with plenty to support that any of the 3 could happen!
Now, why didn’t I think of that!!!
Again, I am being very specific because the Fed and Powell are very precise and nuanced in how they word their statements.
@wendybg said
The above quote is specifically saying that the Fed has said that it
My point is the Fed has never said that inflation needs to get to a specific number (y%) before the Fed will take a specific action (raise, pause, cut). But maybe I missed it.
I have seen no quote from the Fed or Powell or anyone on this thread or this board that contains elements 1 and 2 above. The Fed and Powell do not make statements that specific about their future actions as far as I have seen.
Let’s look at what has been offered.
@wendybg
Three posts in this thread, yet no specific quote provided.
If the the Fed has said it many times and Google can find it so easily, then humor me for five minutes and provide one of the many quotes. If you’ve read my posts, then you know I am not too lazy to find it. I literally have never seen such a quote, so I am asking the original poster to support her statement with evidence (seems reasonable, or don’t bother, this is just an anonymous message board where we humor ourselves).
This quote doesn’t even mention reduce or cut rates. It just says policy needs to be sufficiently restrictive (which could be many different plausible Fed rate decisions) so that inflation eventually gets to 2%. Nothing about cutting or not cutting or pausing or anything on the way to 2% or at 2%. Saying 2% over time can mean many, many different policy scenarios (for example, inflation could go to 3% and the Fed could start cutting then and inflation could still then get to 2% over time - again, one of many policy scenarios that might lead to 2%).
(Powell says Fed will not change 2% inflation goal | Reuters)
Again, this quote says nothing about rate cuts when/if inflation gets to 2%. It just says the target is 2%. Nothing about taking a specific action (raise, pause, cut) when a specific level of inflation is reached.
@rainphakir
This link (https://www.cnbc.com/2023/02/20/the-federal-reserves-2percent-inflation-targeting-policy-explained.html) doesn’t even contain a quote from Powell or the Fed.
Aaahhhh!
Finally, I think I might understand your real question!
We’ve been talking about DIFFERENT concepts!
You want to know when the Fed will start cutting the Fed Funds rate?
I thought you were asking what is the overall TARGET INFLATION rate.
I disagree. I think Powell et al are INTENTIONALLY VAGUE. I think they use word salad that appears “precise and nuanced”, but really is just … Vague.
As far as I can tell, the point at which the Fed rate will stop rising, depends on a set of conditions, one of which may or may not be “what is the inflation number”.
That set of conditions has MOVING parts. One of which is austerity for “us”. We all gotta feel some Pain. No Pain, no “pause”, and certainly no cuts.
This “Pain goal” is the only thing that I think Powell has clearly stated must exist before the Fed cuts the Fed rate.
So, rather than look for an inflation number, perhaps look for the Powell’s Pain on Main?
Powell’s Pain will be evidenced when people lose jobs, unemployment is 5-6%, and people stop spending money.
And fear. Lots of fear.
I’m not yet seeing any Main street Pain.
I see articles claiming to see “indications” (rising CC debt, lower housing starts, etc).
But when I go out on Main Street, I still see LOTS of economic activity. LOTS.
Peace love and light 
ralph
@mostlylong I have noted that as well for months now. It is simply assumed that rates will come down when inflation comes down a lot. I have endlessly been saying that wont be true. Yes rates will ease a bit but we are in a very different economic climate. The question is the balance between the highest income tax bracket and effective corporate tax rate v the FF rate. It wont be all or nothing like in the 1950s. Instead both will only be moderately high. Taxes high but not ultra high and rates higher than in the 1950s. The reason is the 2030s or in other words the affect longer term wont be the same as in the 1960s and 70s.
Ben Bernanke spearheaded counter cyclical economics.
