Brown’s economics department’s professor Gauti B. Eggertsson, gave a talk at Federal Reserve Annual Symposium in Jackson Hole, Wyoming, following opening remark by the Chairman of the Federal Reserve, Jerome Powell, see here. The conference gathers the heads of central bank’s of the world, together with a select number of academics, to discuss key challenges in policy making today. It is one of the most anticipated events on the calendar for market participants that closely follow the Federal Reserve because the Chairman of the Federal Reserve often uses this occasion to announce major policy changes. Professor Eggertsson outlined a new theoretical framework that rationalizes why markets and Federal Reserve failed to anticipate the sharp runup in inflation in 2021, but also why the Federal Reserve could bring inflation down without triggering a major recession, as was predicted by many leading economists. Eggertsson findings were reported by a number of news outlets, such as NYT, Bloomberg and Reuters, as well as in the speech of Chairman Powell.