What Is the Magic of a Stable 2 Percent Inflation Rate?

Federal Reserve Chair Janet Yellen gave a speech yesterday in which she referred to the value of the Fed's 2.0 percent inflation target and warned of the uncertainty caused by any effort to raise the target to a higher rate. While having more stable prices is undoubtedly better than having less stable prices, it is a bit bizarre how this 2.0 percent has become the object of worship.

First, to those who care about such things it should be disconcerting that the inflation rate has been consiste...