Soft landing or hard landing, it's an achievable mark

This week at a conference, I listened to featured speaker, Austan Goolsbee, who is President of the Federal Reserve Bank of Chicago, a noted Economist and frequent contributor to the financial press.  He's also likeable. 

Official Portrait

One day I'll post on entertaining economists because there are several on both sides of the aisle and Dr. Goolsbee, an Obama cabinet appointee and acolyte, will definately be part of that post.

An amusing story Mr. Goolsbee told about a pleasant sense of wonder he experienced while attending a meeting in the Oval Office with President Obama and Larry Summers (the pleasant part ended abruptly) made the audience roar.  

Afterward, during the Q and A period, I anxiously awaited my turn with the microphone.  When prompted, I found the "on" switch with only minor assistance.  My question to Mr. Goolsbee, which I'll paraphrase, was...

We hear much debate from economists and financial journalists about the likelihood of a so-called soft landing.  Some say the pace of rate hikes was too slow, others say the risk will come from cutting rates too slowly.  Whether the outcome will be soft or hard, what exactly constitutes "a landing".  In other words, how will we know who was correct? 

I watched Dr. Goolsbee as I asked my question and witnessed his nodding head.  Then he gave a relatively lengthy answer.  His central points were:

• yes, nailing down the definition of a landing is a fuzzy area but...
• given where we've been, if you consider the Fed's dual mandate and see employment levels at desired level X and you also see inflation levels at desired level Y, then you've pretty much landed softly.

Again, I'm paraphrasing his response, but those were my key takeaways.  I guess there's no final buzzer to signal the end of the game; so if one waits long enough for conditions to change, most any economic seer can claim to be at least partially vindicated.