It’s here. Frustrated that “nominal interest rates cannot be reduced below zero,” he makes the case that “unconventional” approaches are needed (direct purchases of securities with freshly created, high-powered money). This is not a problem, he says, because the Fed “will take account of the potential costs and risks of nonconventional policies…”
If inflation goes wild, it is your fault for not trusting the Fed:
Another concern associated with additional securities purchases is that substantial further expansion of the balance sheet could reduce public confidence in the Fed’s ability to execute a smooth exit from its accommodative policies at the appropriate time. Even if unjustified, such a reduction in confidence might lead to an undesired increase in inflation expectations, to a level above the Committee’s inflation objective. To address such concerns and to ensure that it can withdraw monetary accommodation smoothly at the appropriate time, the Federal Reserve has developed an array of new tools. With these tools in hand, I am confident that the FOMC will be able to tighten monetary conditions when warranted, even if the balance sheet remains considerably larger than normal at that time.
