10 Some policymakers may have believed the misguided notion that  9  The account I present of the role of anchored expectations in stabilizing the economy and favorably altering Phillips curve dynamics echoes a long-held view at the Fed. See Bernanke (2007) and Yellen (2015). Kiley (2015) reviews the recent research literature on this topic. Blanchard (2016) presents a very similar perspective.
10 To be clear, during the periods of rising inflation in the 1960s and 1970s, the FOMC was generally raising the federal funds rate, but with inflation rising, the real federal funds rate was rising much more slowly or even falling. In this sense, the effective stance of policy was tightening slowly or was easing. -8accommodating permanently higher inflation could purchase permanently higher employment.