Journamalism: Word-salad from the Bloomberg Editorial Board. What “Federal Reserve dilemma” are they talking about? What could they be possibly talking about? A “dilemma” is when you face two (or more) options with significant drawbacks. But what might those drawbacks be?

The question “will there be a soft landing?” was “can the Fed get core-PCE inflation back to 2% per year with expectations aligned to that target of its without a deep recession?” The answer to that question turns out to have been: yes. The soft landing has been achieved. It is time to declare victory with respect to that question. With the macroeconomy in balance—in neutral—policy should be rapidly moving toward neutral as well, and should continue to do so until some new shock hits.

Yes, there is a future. And the future will raise new challenges for monetary policy. But to pretend right now that the macroeconomy is not in balance is to simply be stupid. Yet the Bloomberg Editorial Board appears desperate to pretend that there is some important dimension along which the macroeconomy is out of balance. But all they can offer is word-salad:

Bloomberg Editorial Board: Federal Reserve’s Dilemma Is a Nice Problem to Have: ‘A hoped-for soft landing is increasingly plausible, but this won’t make the Fed’s job any easier…. The central bank’s policymakers need to weigh risks and uncertainties that could still upend expectations…. Progress made so far on inflation. The Fed’s preferred… price index… rose 2.9% <bloomberg.com/news/arti… in December from a year earlier…. For the second half of 2023, core PCE prices went up by just 1.9% at an annual rate, bringing that metric back to the Fed’s 2% target. Even so, it’s too soon to declare victory…. If [the Fed] anticipates too eagerly, and demand does not subside as expected, an overstimulated economy might, even now, overturn the central bank’s apparent victory over inflation… <bloomberg.com/opinion/a…>