Martin Feldstein: America's risky recovery

Martin Feldstein

The United States' economy is approaching full employment and may already be there. But America's favorable employment trend is accompanied by a substantial increase in financial-sector risks, owing to the excessively easy monetary policy that was used to achieve the current economic recovery. The overall unemployment rate is down to just 5.5 per cent, and the unemployment rate among college graduates is just 2.5 per cent. The increase in inflation that usually occurs when the economy reaches such employment levels has been temporarily postponed by the decline in the price of oil ...