Have we been thinking about inflation all wrong?
When it starts to get really burdensome to keep your promises, the idea of breaking them gets really attractive. But that doesn&#x27;t come for free. It costs credibility.<p>The cost of central banks breaking their inflation-control commitment when inflation starts running hot, is that the market starts pricing in their unwillingness to raise interest rates. This fuels a whole bunch of other inflation feedback loops, and then before you know it, the central bank wants to get inflation back under control again. But now nobody believes that they&#x27;ll do what they say they&#x27;re going to do, so they end up having to work twice as hard.<p>If your goal is stability, it&#x27;s better to just keep your promises to begin with.