Prior discussion:
speaker: MR. HOENIG.
text: I do not mean to ignore some other developments, which I will keep in mind when Don Kohn presents his alternatives to us a little later. These include a real fed funds rate that remains high in an historical context, core CPI inflation that has been trending lower, pipeline inflation that is essentially absent right now, inflation expectations that continue to be stable for now, inflation indicators that are pointing downward, a dollar that is higher at this point, and long-term rates that are lower than they were somewhat earlier. That is the other side of the coin that everyone is talking about and debating, and we have to keep it in mind as we raise concerns about the level of resource utilization and its implications for inflation. Thank you. 
speaker: CHAIRMAN GREENSPAN.
text: President Boehne. 

MR. BOEHNE. "But I think the time has come for us to be less defensive, and the way we do that is to adopt the stance of being open minded and alert and let the truth, whatever it is, fall out wherever it might."

Full utterance: The economy in the Philadelphia District currently is performing much as it has in recent months. It features steady growth at a moderate pace, tight labor markets, and little or no upward pressure on prices. In commercial real estate, vacancy rates are low and rents are rising. More capacity is in train, however, and rents are expected to be under less pressure as more space is completed. As yet, there is surprisingly little speculative building going on in the Third District. Although wage increases seem to be holding at around 4 percent, there are more reports of additional perks, signing bonuses, and other incentives to attract and retain skilled people. With business activity generally favorable, attitudes are positive but tough competition seems to be providing a restraining influence on the development of a boom mentality. Turning to the nation, we are in a reasonably comfortable position for now. Actual performance at the macro level continues to be surprisingly good, and the risks to that favorable performance are largely unchanged from recent months. Like some of the rest of us, I did appreciate the confessions of a tortured staff. Perhaps the time has come for all of us to torture ourselves less. Most people like to be right rather than wrong; most would rather have the outcome turn out to be better than worse. The problem here is that things have turned out to be better, but most of us have been wrong. [Laughter] Depending on one's mindset, each of us will respond either by saying, "The old model is still true; just give it time; it will reassert itself," or by saying, "There is a new model at work and the world is indeed different." My guess is that the truth is probably somewhere in the middle. We just do not know where in the middle at this point. But I think the time has come for us to be less defensive, and the way we do that is to adopt the stance of being open minded and alert and let the truth, whatever it is, fall out wherever it might. In the meantime, we make the best judgments we can. If we are right, we are right; and if we are wrong, we are wrong. But I do not think we ought to torture ourselves any longer.

Opinion: yes
About monetary policy: no