Alex Pollock’s latest letter to the editor at the WSJ appeared on Saturday, November 1:
As your editorial (”Getting Used to 3% Inflation,” October 25-26) suggests, 3% is a lot of inflation, much worse than 2%, which is already too high. At sustained 2% inflation, which the Federal Reserve promises, average prices will nearly quintuple in a lifetime of 80 years and the dollar will shrink to a value of 20 cents. At 3%, average prices will multiply by more than 10 times, and the dollar will become 9 cents. Neither satisfies the goal of “stable prices” assigned by the Federal Reserve Act, but 3% misses by a mile. As the great Paul Volcker wrote in his autobiography, “The real danger comes from encouraging or inadvertently tolerating rising inflation and its close cousin of extreme speculation.”
Yours truly,
Alex J. Pollock
