This tweet is correct, but tells only a part of the story:
I’ve made the same point many times. This is why I’ve been advocating treating the fed funds target more like a market price. I’ve argued that this rate should be adjusted daily to the nearest basis point at the median vote of the FOMC (voting by email if necessary). Under that system, policy “reversals” would occur frequently, and would be seen as normal, not embarrassing.
Nonetheless, the current debate about where the Fed should set interest rates mostly misses the point. The Fed needs to set a clear nominal target, and then stick to it. Where do they want the PCE price index to be in January 2025? Or better yet, where do they want NGDP to be in three years? That would do far more to stabilize the economy and prevent recession than any tweaking of interest rates. The economy is currently being destabilized by abysmal communication out of the Fed. No one seems to know if they are still committed to FAIT, and if so what that means. So tell us!!
PS. I have a new article at The Hill that provides three reasons why the Fed screwed up in the second half of 2021. Please read the whole thing.