Rate Outlook
Bullard recently told the Financial Times the Fed “should get on with normalization” as soon as possible so that it does not have to raise rates more aggressively later causing significant market volatility.
He is confident that weakness in the first quarter will prove temporary, and that asset bubbles similar to the housing bubble that prompted the U.S. economic collapse may form if the Fed is too slow to tighten.
“Zero [interest rates] is too low in that kind of environment. I wouldn’t be comfortable with that. A zero rate would feed into an asset price bubble”, he said recently. “When asset bubbles start, they keep going until they blow up out of control with devastating consequences.”
“Boom times ahead, plus us already charting out low interest rates, sounds like risky from a bubble perspective,” he also said in April.
Biography
Bullard is a native of Forest Lake, Minn. He began his career as an academic economist and monetary policy scholar.
Bullard joined the Federal Reserve Bank of St. Louis in 1990 as an economist in the research division. Prior to becoming president, Bullard was vice president and deputy director of research for monetary analysis at the Federal Reserve Bank of St. Louis.
Bullard is an honorary professor of economics at Washington University in St. Louis, where he also sits on the advisory council of the economics department