Such a rigid gimmick has little chance of being adopted. The economy has grown more difficult to read. Numbers alone do not tell the tale. While unemployment may be declining to a point that once would have led to labor shortages and wage hikes, years of layoffs have created a work force that is happy just to have a job. When people are still worried about holding on to their jobs or having to move to lower-paying ones, they are not thinking of walking into the boss and demanding a raise.
People have good reason to worry.
At the same time, the flood of mortgage refinancings that put hundreds of millions of dollars in homeowners' pockets has all but dried up, closing off a valuable source of extra cash. Of course, rising rates have also led some buyers to rush into the market while they can still afford a home. Outside Atlanta, Jim and Amanda Arnold bought a two-story house last month instead of waiting until August as they had intended. Bradley's advice was heeded, and he went on to glory. The course of today's economy will determine whether the Fed's offensive against inflation gives stature to its critics.