DONALD TRUMP TOOK several shots at the Federal Reserve during his election campaign. Let's hope he effects a real overhaul of this increasingly destructive agency. Fed boss Janet Yellen's recent appearance before the Joint Economic Committee underscores why a major makeover is necessary for our future prosperity.
Yellen openly and unapologetically made clear that our central bank still hews to the discredited theory that prosperity causes inflation. "The economy is operating relatively close to full employment at this point," and therefore higher interest rates will be warranted. The idea is that a hike in the cost of money would ensure that the economy didn't get too strong. Otherwise, employers would aggressively bid up wages, which could fuel too much inflation.
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