Federal Open Market Committee (FOMC) sets policy for the Federal Reserve.
Data to Monitor Once A Month \\ 50 Plus Year Average \\ Acceptable Range
Consumer Price Index YOY (CPY) Avg 3.8% Range 3%-5%
Case Shiller Home Price Index YOY (HPY) Avg 5.29% Range 3.5%-7%
Unemployment Rate (UR) Avg 5.73% Range 4.5%-7%
Raise/lower Federal Funds Rate if CPY is too high/too low
Raise/lower Federal Mortgage Rates if HPY is too high/too low
Raise/lower Quantitative Easing if UR is too low/too high
Auction Off Troubled Financial Institutions
Financial Institution Tests
Uninsured deposits / domestic deposits < 50%
Loans and held-to-maturity securities / total deposits < 50%
Financial Institutions that fail both tests for two consecutive quarters are auctioned off.
RESULT: No peer pressure, no human error, no recessions!
FOMCGPT(tm) To The Rescue!
A ChatGPT bot (FOMCGPT) has been designed to generate Federal Reserve policy once a month incorporating the algorithm above using easily modifiable configuration files. It is being tested using Federal Reserve FRED data from April 2021 to April 2023.