Christina Romer says that she finds it strange that people are talking a lot about inflation. The large output gap (slack in the economy) means there is plenty of time to unwind expansionary policies, Reuters reports.
Not to mention that most of the money minted by the Fed is still sitting on deposit at the Fed, making unwinding the balance sheet expansion easier than it would appear.
The bond market agrees, with 10-year notes now trading at a 3.37% yield, near recent trend lows.
