John Taylor of Stanford University has pointed out that even measured against what is known as the Taylor rule (an empirical characterization of past Federal Reserve interest-rate policy, which sees the short-term policy rate as a function of the inflation rate and the gap between the output the economy is capable of and what it actually produces), the Fed should have started raising interest rates by early 2002.
in fact, apparently fed should have started raising rates in 2002, according to Taylor Rule
