While the Bank believes it important to continue with the current monetary easing persistently, some argue that continuing with monetary easing for a long period entails risks. In what follows, I would like to express my views on the two risks that have been pointed out.
Nowadays when Board economists present the results of dynamic simulations in briefings, and the simulations look very reasonable, I think I am one of the few people in the room who is deeply impressed. Doctrinal historians will have fun with the naming of this model. Whenever Board people wrote about it, it was the Fed-MIT model, or perhaps the Fed-MIT-Penn model.